Cable Offers 50% Broadband Discount to School Lunch Bunch

About 1.8 million low-income households with children in a school lunch program will be offered a 50 percent discount on cable modem service under a proposal unveiled today by the National Cable & Telecommunications Association (NCTA) .

Comcast Corp. (Nasdaq: CMCSA, CMCSK), Time Warner Cable Inc. (NYSE: TWC), Cox Communications Inc. , Charter Communications Inc. , and several other NCTA members are on board but still need to work out details of the two-year pilot program, called Adoption Plus (A+), including how computers will be supplied to eligible homes. But the move should help the big MSOs appease federal regulators that are developing a national broadband plan. (See NCTA Proposes Broadband Adoption Plan.)

"You’re making a tremendous contribution," Blair Levin, the Federal Communications Commission (FCC) executive director of the omnibus broadband initiative, said on a conference call with NCTA officials this afternoon.

NCTA is targeting 3.5 million middle school children in grades six through nine from 1.8 million households nationwide. NCTA president and CEO Kyle McSlarrow said households will be selected for Adoption Plus based on whether they are eligible for the National School Lunch Program.

MSOs represented by NCTA agreed to provide free cable modem installation in addition to a 50 percent discount on high-speed Internet service. U.S. cable's primary lobbying group placed a $572 million valuation on the contribution from cable operators, but McSlarrow acknowledged it’s difficult to determine an exact value since not all 1.8 million households eligible for the program are expected to participate.

The broadband initiative is based on a pilot program that Cox launched in Santa Barbara, Calif., in 2002. NCTA compared the breadth of the initiative to Cable in the Classroom, a program founded in 1989 that saw the cable industry wire thousands of schools and local libraries nationwide with cable TV service and, later, broadband Internet access.

McSlarrow said NCTA is talking to computer manufacturers about providing "free or discounted" computers for the program. While cable’s chief lobbyist was bullish on the prospects for the program, he noted that Adoption Plus is now just getting off the ground.

"The program is a two-year pilot. It didn’t make sense to go all-in on a national proposal that hadn’t really been tested," McSlarrow said. "We’re testing a proposition that if you attack the lack of broadband adoption with a comprehensive program, you can actually move the needle in a meaningful way."

NCTA said it is recommending that the feds allocate $100 million in funding to local school districts to administer the program, and implement educational programs involving online safety and how to use computers and broadband Internet. But McSlarrow said that cable operators aren’t asking for federal subsidies to cover their contribution to the program.

NCTA filed the Adoption Plus program with the FCC Tuesday. The commission began considering proposals earlier this year for a national broadband plan that would see all households wired with high-speed Internet access. The Commission is scheduled to present the plan to Congress on Feb. 17, 2010. (See FCC Boots Up National Broadband Plan and 100-Meg Price Tag: $350B.)

— Steve Donohue, Special to Cable Digital News

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