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TracFone Wireless, Inc. Issues Fact Sheet About Wireless Broadband Pilot Program

Stocks in this article: AMOV AMX

MIAMI, Feb. 7, 2013 /PRNewswire-USNewswire/ -- TracFone Wireless, Inc., issued the following fact sheet today about the wireless broadband pilot program it is undertaking at the direction of the Federal Communications Commission (FCC) to benefit income-eligible households by "increasing digital literacy and use of the Internet [to] help bridge the skills gap [and] reduce job search discouragement."

Fact #1:  The FCC's Wireless broadband pilot program is seeking ways to bridge the digital divide, while using the best practices in doing so.    As the FCC explains:  "The primary goal of the Pilot Program is to gather high-quality data that will help identify effective approaches to increasing broadband adoption and retention by low-income consumers …"  To achieve this goal in the selection process, the FCC strongly favored pilot projects designed as field experiments that implement standard best practices common among field experiments. TracFone's pilot project is listed by the FCC as an example of such a carefully designed field experiment.

Fact #2:  All aspects of the TracFone pilot project application and the FCC selection process are a matter of public record.    Full documentation about all proposals and why individual pilot projects were selected by the FCC is available at http://apps.fcc.gov/ecfs/comment/view?id=6017161168 and generally through the FCC's Electronic Comment Filing System at http://apps.fcc.gov/ecfs/.

Fact #3:  In a competitive process, the FCC chose TracFone Wireless as one of a number of companies to carry out wireless broadband pilot projects for the FCC.    A total of 14 pilot programs were authorized by the FCC.  TracFone submitted two different pilot project proposals, one of which was selected.

Fact #4:   The TracFone pilot project is limited to 12 months.   Federal Lifeline support for the TracFone pilot project is capped at $915,000.

Fact #5:  The TracFone pilot project will be carried out in Florida, Maryland, Texas, Washington, Wisconsin and Massachusetts.    The project will study the effects of subsidy amounts and discounted hardware.  TracFone, in partnership with Technology Goes Home, will test the effect of both discounted price and hardware cost on mobile broadband adoption and retention using four variations in its broadband service plans and one control group randomly assigned over a large, geographically diverse sample.  By offering varying combinations of free or discounted hardware and $10 or $20 per month service, low-income customers' sensitivity to upfront and ongoing prices can be measured.  

Fact #6:  Taxpayers do not pay a penny for wireless Lifeline, including pilot projects.  Cutting the Lifeline program or removing funds for broadband pilot programs will not reduce the federal deficit by one cent.   That is because federal funds do not pay for Lifeline.  The program is not funded with tax dollars.  Instead, this program is funded by contributions from telecommunications companies, which can elect to share the costs of those contributions with their subscribers.  Companies that offer free wireless cell phone services pay for the phone themselves. Far from imposing a burden on taxpayers, wireless Lifeline has been documented to help low-income people find and keep jobs, which ultimately reduces spending on public assistance programs.

Fact #7:  TracFone has been a leader in promoting tight oversight of the overall wireless Lifeline program to control fraud and abuse.     There is a strict prohibition against beneficiaries receiving Lifeline benefits for more than one phone service.  The FCC recently took actions to further tighten eligibility requirements and transparency in the wireless Lifeline program.  Many of the eligibility requirements that were adopted were done so at the urging of TracFone Wireless.  The FCC included such TracFone-backed reforms as a 60-day non-usage policy, identity checks by using the individual's name, date of birth, Social Security Number and address, and most importantly, the creation of a national database to verify applicant information by 2013.  TracFone has been a proven leader in preventing waste, fraud and abuse and is currently working to form public/private partnerships with states to help create Lifeline eligibility databases and to enable Lifeline providers to access existing state databases. 

TracFone Wireless, Inc. is a subsidiary of America Movil S.A.B. de C.V. ("AMX") (BMV: AMX; NYSE: AMX; Nasdaq: AMOV; LATIBEX: XAMXL), AMX is the leading provider of wireless services in Latin America.

SOURCE TracFone Wireless, Inc., Miami, FL

Copyright 2011 PR Newswire. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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