MIAMI, Fla., June 25, 2024 — Six million U.S. households will lose their broadband connectivity as a result of the ending of the Federal Communication Commission’s Affordable Connectivity Program (APC). According to a new report from wireless research firm Maravedis, 25% of the 23 million households who enjoyed the ACP benefits will drop their connections, 25% will maintain connectivity, and 50% will fluctuate to on-and-off service based on promotional programs. These are key findings from the new Maravedis independent report titled, “Managed Connectivity for Affordable Housing in the United States 2024-2029.”
“More than 40% of households whose annual incomes fall below $25,000, lacked a wireline subscription as of 2022[1]. Given that the large majority of affordable housing happens in multifamily units, providing affordable connectivity in multifamily housing can be a sustainable business model under the right public-private partnership” said Adlane Fellah, Chief Analyst, Maravedis
Managed service providers need long term, non-exclusive bulk internet deals with property owners to make the business case succeed. “Lifeline and other subsidy programs should be made eligible to bulk internet deals to encourage long-term, favorable deals which benefit an entire property.” Fellah added.
“This research amplifies the need to get serious about ending the digital divide once and for all. Too often, residents of affordable and low-income housing are left behind. It’s also where we’ve seen the proven success of bulk internet and managed Wi-Fi solutions to move the needle—critical tools that policymakers should embrace and leverage to magnify the impact of historic broadband infrastructure funds being rolled out across the country,” said Kevin Donnelly, VP Govt Affairs, Technology and Strategic Initiatives with the National Multifamily Housing Council.
The business case works if the capital investments required to switch on the internet in affordable multifamily housing is paid for by public entities, while private property owners cover the ongoing cost of running the network as part of operating the property. The monthly connectivity opex in a bulk model can be even lower than the $30 ACP subsidy.
“Many affordable housing properties are underserved by traditional ISPs in both fiber access to the property as well as modern inside wiring. Managed bulk services consistently deliver a lower cost and more reliable internet solution for multifamily properties who invest in better outcomes for their residents,” said Matt Tyre, Vice President Sales, Spot On Networks.
In March 2024, the FCC announced they were seeking to ban bulk billing for multifamily tenants. No matter what the FCC decides about managed bulk internet, it only makes sense for property owners to provide a fast, secure, and seamless connectivity experience for residents of affordable housing.
“In any MDU the best option for the best coverage in a dense environment is a managed Wi-Fi system along with wired connections. Dojo Networks has been working diligently with affordable developers, operators as well as housing authorities and government agencies to bring this same technology to this market and have been big advocates to solve this portion of the digital divide.” Said Daniel Myers, President, Dojo Networks.
The report includes interviews with leading service providers and property owners active in the market. It also includes market-sizing projections for managed services from 2024 to 2029. More information about the independent report is available in the research abstract here.