LIFELINE AND TRACFONE PROVIDE CELL PHONES FOR THE NEEDY

 

Here are two news articles (The New York Times and The News & Observer) on the federal government subsidy that enables the poor to obtain free cellphones and free service.
  
Many people who qualify for this service, do not even know that it exists. In fact, this service has been around for the last 25 years, but, the free cellphone, and the free non-911 calls, are new.
  
Since November, the number of customers receiving free or subsidized wireless service has doubled to 1.4 million. To be eligible for the program, known as Lifeline, a person must meet federal low-income guidelines  or qualify for one of a handful of social service programs, including food stamps or Medicare. To apply for this program, those who are eligible can click on the Safelink site here  for more information.
 
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PROVIDING CELLPHONES FOR THE POOR
 
Published: June 14, 2009
 
John Cobb, 59, a former commercial fisherman who is disabled with cirrhosis of the liver and emphysema, lives in a studio apartment in Greensboro, N.C., on a fixed monthly income of $674. He has been hoping to receive more government assistance, and in February, he did.
 
It came in the form of a free cellphone and free service.
 
Mr. Cobb became one of a small but rapidly growing number of low-income Americans benefiting from a new wrinkle to a decades-old federal law that provided them with subsidized landline telephone service.
 
In a twist, wireless carriers are receiving subsidies to provide people like Mr. Cobb with a phone and typically 68 minutes of talk time each month. It is a form of wireless welfare that puts a societal stamp on the central role played by the mobile device.
 
Mr. Cobb’s cellphone is a Motorola 175. “I feel so much safer when I drive. If I get sick, I can call someone. If I break down, I can call someone,” Mr. Cobb said. “It’s a necessity.”
 
The users are not the only ones receiving government assistance. Telecommunications industry analysts said the program, while in its infancy, could benefit mobile phone carriers, who face a steep challenge of their own: most Americans already own a cellphone, so the poor represent a last untapped market.
 
“The low hanging fruit is gone, and the wireless companies are going after the nooks and crannies,” said Roger Entner, a wireless industry analyst with Nielsen. “Oh, the poor: How can we sign them up?”
 
Carriers can receive up to $10 a month in government subsidies, sufficient to cover what amounts to about $3 in service, Mr. Entner said.
 
Since November, the number of customers receiving free or subsidized wireless service has doubled to 1.4 million, he said. To be eligible for the program, known as Lifeline, a person must meet federal low-income guidelines or qualify for one of a handful of social service programs, including food stamps or Medicare.
 
The opportunity has prompted interest from the nation’s biggest carriers, including Sprint Nextel and AT&T. But at the forefront is a much smaller company, Tracfone, a Florida provider of prepaid mobile service that has become the face of the fledgling subsidized cellphone.
 
Tracfone began providing its service, called SafeLink, in Tennessee in August and now does so in 16 states, including New York, North Carolina and Pennsylvania, and the District of Columbia, according to its Web site. Each time it enters a market — which generally requires state approval — it runs television ads telling people how easy it is to get a free Motorola phone, like Mr. Cobb’s.
 
The company says the economy makes the audience particularly receptive. “We’ll read that more people are signing up for food stamps and look at our numbers and see volume rising,” said Jose Fuentes, director of government relations for Tracfone. “It’s not scientific proof,” he added. “But we know times are tough.”
 
He declined to say how many subscribers have signed up. But he said Tracfone, whose paid service has 10 million subscribers, sees the Lifeline service as an opportunity to make some money but, more pointedly, to eventually convert the subsidized customers into paying ones if their fortunes turn around and they no longer qualify for a free phone.
 
“It could make for a good business,” Mr. Fuentes said.
 
According to Nielsen, 90 percent of Americans have at least one cellphone. That leaves 32 million, including the infirm, still up for grabs. “And the race is on to get them,” Mr. Entner said.
 
He said the overwhelming majority of Americans with subsidized wireless service receive it through Tracfone.
 
One of them is Leon Simmons, 52, of the Bronx, N.Y., who did stints in the Navy, at the Post Office and as a security guard before becoming disabled with emphysema. His wife, who works a minimum wage job at a laundry, heard about the Tracfone service and he got a phone in April.
 
The free phone is not, as it is for some others in the program, their sole form of telecommunications. Out of the roughly $1,600 they make each month after taxes, they pay $159 for a landline telephone, high-speed Internet and cable television. But the cellphone, Mr. Simmons says, gives him the flexibility to tell his wife or daughter his comings and goings or to stay in touch when he is at the doctor.
 
According to the Federal Communications Commission, Lifeline service was started in 1984 to ensure that everyone had telephone service for emergencies. The Telecommunications Act of 1996 opened competition to new wireline and wireless providers.
 
More recently, companies, particularly Tracfone, have started pursuing the wireless opportunity. Still, most of the $800 million in subsidies last year went for landline service even as more Americans cut the cord in favor of exclusively using a mobile phone.
 
The subsidy money comes from a tax applied to phone bills. Carriers seeking eligibility for it apply to state utility commissions, though several states have ceded their jurisdiction in the matter to the F.C.C.
 
The issue has created controversy in some states over how and even whether to subsidize wireless service. In California, for example, the public utilities commission plans to debate on Thursday a proposal to extend Lifeline services to wireless — a matter backed by companies like AT&T and Sprint and T-Mobile.
 
The Greenlining Coalition, a nonprofit advocacy group for low-income residents, has lobbied the state to “move the California Lifeline program into the 21st century,” according to public documents provided for the hearing on Thursday.
 
But State Assemblyman Felipe Fuentes, who represents a district in Los Angeles, says the California legislature should ask some tough questions before moving ahead — particularly if people contemplate making wireless their only form of communication. Chiefly, he wants to know whether wireless service satisfies crucial aspects needed in lifeline, like reliability in an emergency.
 
“What if the phone isn’t charged, or junior doesn’t know how to use it?” Mr. Fuentes asked.
 
Across the country, Mr. Simmons from the Bronx says he likes being able to communicate when he is on the go. And he does not see what all the fuss is about when it comes to cellphones.
 
“People walk around with their head stuck into these things, not paying attention to what’s going on around them,” he said. Even though he thinks these people look silly, he said, he is going to use his cellphone.
 
Why not? he said. “It’s free.”
 
  
  
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
  
FOR NEEDY, CELL PHONES CAN BE FREE
  
A federal program will pay for service
 
By John MurawskiStaff Writer
 
Published: Tue, Apr. 14, 2009 04:47AM
Modified Tue, Apr. 14, 2009 04:49am
An obscure federal program that helps poor people pay for phone service is entering the wireless era. Cell phone companies are offering the needy a bargain that the rest of us can only dream about: free service.
 
TracFone, a national wireless phone service company, this month began offering its no-cost service to the nearly half a million low-income families in the state that are estimated to qualify. Its competitor in the prepaid market, Virgin Mobile, plans to offer a similar service this summer.
 
Both services are subsidized by the federal government’s Lifeline program, created 25 years ago to ensure that poor people had phone service. People who qualify usually pay about half of the monthly cost for phone service. Despite the discount, only a third of households eligible for the program use it. In this state, fewer than 126,000 customers are signed up.

Getting a Lifeline

TracFone is a prepaid wireless provider and offers SafeLink in 10 states and the District of Columbia.
 
To qualify for the program, a household must be participating in at least one of the following programs:
 
Medicaid
Food Stamps
Supplemental Security Income
Federal Public Housing Assistance (Section 8
Low-Income Home Energy Assistance Program
Work First Family Assistance
Temporary Assistance to Needy Families
Crisis Intervention Program
 
Under the rules of the Lifeline program, a low-income household can have just one phone subsidized by Lifeline. But the program does not prevent a household from having a landline phone and a wireless phone, as long as only one is subsidized.
Details of Virgin’s plan aren’t yet available, but TracFone’s program, called SafeLink, provides unlimited free 911 emergency calls, as well as 68 minutes of free calling time every month, with a free Motorola cell phone that normally costs $9.99. SafeLink also comes with voice mail, caller ID, call waiting, voice mail, long distance and text messaging.
 
“If they can offer a phone service for free and make a profit doing it, I’m all for it,” said John Garrison, director of the communications division of the Public Staff, the state agency that represents consumers in utility matters. “Any way we can get more people onto Lifeline service, who qualify for it, I think it’s good.”
 
José Fuentes, TracFone’s director of government relations, won’t say how many people in the state have signed up, or how it can make a profit off the $10 per household federal subsidy it receives to provide the Lifeline service. But Fuentes says the company sees a potential market of 26 million households nationwide.
 
Wireless companies like Florida-based TracFone and New Jersey-based Virgin Mobile operate by buying access on other carriers’ networks and typically get volume discounts as their customers gab and text their way through more minutes.
 
TracFone’s customers aren’t limited to their free 68 minutes a month. Customers can buy additional calling time — for 5 cents a minute — if they want to exceed their monthly allotment.
 
Only four minutes left
  
April Crudup of Raleigh has been a TracFone SafeLink customer for the past month, and already, with half the month left, she says she is down to four minutes on her account. She has a regular AT&T home at phone but lost her previous wireless account several months ago when she wasn’t able to pay the bill. She’s on food stamps and has six kids, ages 1 to 10.
 
She said she needs a cell phone “for when I’m out and something happens.”
 
To qualify for a Lifeline phone and service in this state, a customer must participate in at least one federal or state income assistance program, such as Medicaid, food stamps or Section 8 Public Housing. Most of the households with Lifeline phones in North Carolina are customers of AT&T and Embarq, the state’s two biggest phone companies. The landline phone accounts subsidized by Lifeline and offered by AT&T, Embarq and other phone companies don’t impose monthly calling limits and allow unlimited local calls.
 
My kid made me do it
  
Ester Lennon of Raleigh received her TracFone account last week, at her daughter’s insistence. The 70-year-old retired nurse moved to the area in 2005 after living four decades in Florida, and she returns to the Sunshine State by train every year to see her neurosurgeon and her eye doctor. The overnight Amtrak train has arrived as many as eight hours late, Lennon said, requiring travelers to carry a cell phone or borrow one from a fellow traveler.
 
Lennon, who’s on Medicaid and has four adult children living in Florida, has a landline phone at home but says she needs a cell phone.
 
“Even when I take my garbage out, I take my cell phone in my pocket just in case if I were to fall or something happens,” she said.
john.murawski@newsobserver.com or 919-829-8932
 
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20 Comments

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20 responses to “LIFELINE AND TRACFONE PROVIDE CELL PHONES FOR THE NEEDY

  1. Harry

    I think this is a wonderful program. The times are certainly tough at the moment and there are a lot of people out there who are going to need all the help they can get to get back on their feet.
    A prepaid cell phone is just the thing to get call-backs for job offers and for making appointments for interviews.
    I am a proud Tracfone user myself, their coverage and service in general in great. Kudos to Tracfone for being involved with this very worthy project.

  2. leasprayers

    A friend of mine needed a ride to go pay her water bill, so I took her. My husband, a disabled vet, stayed at home and saw a car that looked just like mine on the news…totalled. It happened just a couple of blocks from the utility company and I saw it also.

    My husband panics easily, and I knew he was likely watching the news…fortunately my friend had her free Tracphone for low-income families and she was able to call my house for me and reassure my husand that all was well.

    My friend has suggested that, since we live on a very fixed income (his disability) and because all we have is an internet based service (wireless is not conducive to consistent signals here), we should apply for one of these.

    And so I have done. I’m so glad this service is available. I’ll feel better about being able to stay in touch with him at home when I must go farther than the yard.

  3. Marsha Powell

    I received my safe link cell phone. I think it waa and is a great thing. It allows individuals that couldn’t.afford a cell phone an opportunity to acquire one. I feel they are good to have in emergencies. The only problem is every city in north carolina isn’t elgible yet I dnt know why.

  4. Albert

    Unfortunately, churches and private organizations should be helping people in need, not the government.

    Tell me what’s wrong with this picture?
    “April Crudup of Raleigh has been a TracFone SafeLink customer for the past month, and already, with half the month left, she says she is down to four minutes on her account. She has a regular AT&T home at phone but lost her previous wireless account several months ago when she wasn’t able to pay the bill. She’s on food stamps and has six kids, ages 1 to 10.”

    Six kids? Are you kidding me? Why have six kids if you can’t pay your bills. Why should taxpayers continually fund the irresponsible?!

    • BLEYZ33

      The government/taxpayers are not funding this feature. It is paid by subsidies to the cell phone company this has nothing too do with tax payer’s dollars or the president..

      • Panther Dan

        You do realize what the word “subsidy” means, right? It means that the government, with our tax dollars, pays the cell phone companies $10/month for each “free” cell phone they provide. So, we can easily dedude, we are indeed paying other people’s cell phone bills with our tax money. It has EVERYTHING to do with taxpayer’s dollars! I don’t blame the President in this, but it is still representative of his plans for wealth redistribution.

    • caribe

      i really want this phone

  5. BlameAmericaFirstCrowd

    This is a very bad idea. Just another government redistribution program that will end up very badly. TracFone is driving up the surcharge that everyone (who is not low-income) pays on the Federal portion of their phone bill to approximately 14.3%!! That is amazing and people will start rebelling against these so-called “Obama phones.”

  6. Ali Blabber

    I love how some people refer to the Safelink program as “an Obama phone.”

    WTF?

    The program’s been in effect for 25 years and finally recognizes the reality of cell phones as a viable option for communication.

    And the phones themselves are cheap, low-end devices, but the right wing echo chamber rails against this because of the perception that cell phones are somehow “luxuries.”

    Crazy.

  7. EnufZNuf

    I didn’t have a problem with the so-called “Obama Phone.”

    It seemed reasonable to give poor people a cheap phone and a few minutes a month.

    Go find a job. Go to the doctor. Get the car fixed. Whatever.

    But now, Virgin Mobile has a new program that gives poor people 200 minutes a month.

    FREE!

    It’s too much!

    What’s next? Iphones? Blackberries?

    Virgin is using taxpayer money extravagantly.

    Am I wrong?

    MODERATOR: Yes, you are wrong.

    • Panther Dan

      The phone should be used for emergencies, as a regular landline can take care of many of the needs a cell phone provides. As for people piling up minutes on their own cellphones, so what? They are paying for them, they can use them how they wish. Just another government handout that WE, THE WORKING CLASS, PAY FOR.

  8. Bobby

    This country has lost it ‘s way. The America we grew up in in fading away. The things that we enjoyed and were proud of will be a thing of the past. What is happening here is our government is making back room deals with large corporations on the backs of the tax paying citizens in the name of charity.

    Let this continue and we will all be living in a country similar to Vietnam

  9. renea

    i like the idea. after working many years at 60K, and now out on SSDI trying to raise my kids off $1100/mo – every area I can cut costs is great. I am concerned about the service in different areas vs the major carrier I’ve used for the last 17 yrs. As i’m subject to have to call someone to come get me whenever my body is uncooperative and I’m out. I’m also concerned about the programs not giving more up front info on the add ons. They say texting/more mins are available, but several don’t give specifics. I already dropped my plan with my current carrier, and we text more to save minutes, but I’d like this option with the life line phone. Whichever one I go with – I want to be able to buy enough minutes to cover us (instead of high overages ea mo); AND be able to keep it at regular rate once I beat this health thing and get back to work. As you can see, I like stability and switching phones every other year is not me at all.

  10. renea

    PS – After working AND PAYING TAXES since age 14, and to get sick and face homelessness, devastation, welfare, foodstamps, etc…(the whole thing), I have no qualms about any service I can get from the govt. They took my money all those years, and now that I’m sick, tell me congress passed a law that says they don’t have to pay you what your Soc Sec end of year statement says – but only a portion of it. They figure out every way they can to cut programs for folk who really need/WANT the help to move on. From cutting food stamps and taking mos to restart them (mess up a budget and puts you behind), to lowering housing assistance help at the drop of a dime, taking months to correct (with NO retro – again – budget buster), denial of medicaid to get the proper care; outrageus medicare co-pays that you can’t afford…..Yes, I’ll take the phone, computer, car, laptop, house, clothes, food, and whatever else i’m eligible for.

    I used to despise people that sat home “collecting a check”, now I see some of them LEGITIMATELY NEED the help, have paid their dues, and are entitled to a refund of their tax dollars by way of services when in need.

  11. Sarah

    I had safelink wireless for one year with only 68 minutes. These minutes are only for emergencies. I have to say that all the boldness and the misconceptions with free cell phones really upsets me. Many of the comments of negativity must be coming from those who don’t have disabilities or struggles. You talk about tax payers getting ripped off or being taken avantange of! I have multiple physcial problems , I have paid taxes and I have been robbed of my health and have no choice but to depend on whatever help I am eligible for. Before you talk about the program, you need to walk into our shoes. Just because you have a JOB and good to fair health doesn’t mean that this is forever. Anything can happen to you and you have to depend on the Government’s help. I get SSI in the amount of $674, I can barely buy clothing or afford my medications because I have rare physical problems and some of my supplements or compounds aren’t covered under medicaid. Everyday I wish I had fair health to be able to work steady but the more I do the worse my condition gets. I have a genetic form of dystonia with other health issues, when I’m out and about I need a phone to call someone in case of an emergency, so I have a landline and a cell phone. I would love to have to pay for just one telephone. There should be a choice in the matter depending on the need. I wish that my lifeline discount could be switched to my cell phone line, then I would diconnect my landline and pay for unlimited service with my cell phone allowing me to be and feel safer, even when I’m taking out the garbage. Those with physical, Visual, mental and other challenges like arthritis and such should have a choice of telephones. I couldn’t use safelink because it was so small. Making a call was very difficult and also with blurred Vision how would you know if you are dialing the right numbers. This is why choice of telephones should be welcome. Look at the entire picture before you judge. Everyone is not dishonest, and you can’t sift out those who want to take advantage of the program from those who are in critical need of it.

  12. arrin vaughan

    I was interested in getting a cell phone.I currently get foodstamps,waiting on disability.

    Darrin Vaughan
    orma,wv

  13. FRED C RICE

    I MOVE HERE TO LOS ANGELES FROM MIAMI, FL. WITH MY TRACFONE, I LOST MY PHONE; TRY TO RESTABLISH, AND GET A REPLACEMENT PHONE, AND WAS TOLDN MY SERVICES WITH SAFELINK WILL BE DEACTIVATE! NOW I’M TOTAL LOST, BECAUSE ALL OF MY APPLICATION THAT I HAVE PUT OUT ARE NOW DEAD!!!!!!!!!!!!!!!!!!

  14. Yvonne

    how do I apply for a free cell phone.

  15. Yvonne

    How do I go about getting a free cell phone I met the requirements please advise.
    Thanks Yvonne

  16. Louis

    This is a good help to those who are in need. I would rather my tax dollars go to helping someone who is looking for a job and needs this phone service, than for my tax dollars to be sent overseas to help the enemies of this country—-Pakistan, anyone?

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