Impact Blog
Telecoms show leadership in support of users most in need

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      By Daniel RourkeESG Senior Research Analyst, Calvert Research and Management

      Washington -- As the COVID-19 crisis unfolds and people self-quarantine, they are increasingly relying on home internet access to work, study and - in many cases - obtain telemedicine services. This is providing a real-time view into digital inequality between those who have access to and can afford high-speed internet and those who cannot.

      On March 13, the Federal Communications Commission (FCC) - which estimates that more than 20 million people in the US lack access to high-speed broadband - obtained promises from several telecommunications providers to sign on to the "Keep Americans Connected Pledge." Companies that adhere to the pledge commit for the next 60 days to:

      • Not terminate service to any residential or small business customer because of an inability to pay bills due to COVID-19 disruptions
      • Waive late fees that customers incur because of changes in their economic circumstances related to the pandemic
      • Open Wi-Fi hot spots to those in need

      Nearly 70 companies have taken the pledge, including AT&T, Century Link, Charter, Comcast, Sprint, T-Mobile and Verizon.

      Verizon and AT&T, the two largest telecommunications services providers in the US, appear to be showing corporate leadership beyond the pledge, which is in line with what would be expected from two of the largest consumer-facing brands in the US.

      For example, Verizon is focusing on the near-term needs of health care workers and underresourced students. To support health care workers, the company is deploying portable cell sites to provide network coverage at Emergency Operations Centers, mobile testing sites and quarantine areas. To support students, Verizon made additional investments in its education initiative that targets middle schools on the forefront of the digital divide — tripling their data allowances and upgrading data plans for the next two months to facilitate learning from home.

      AT&T is offering unlimited home internet to its customers, including limited-income households that pay reduced rates. To support learning from home, the company has increased funding for its initiative that is helping to close the digital divide in high-needs schools.

      This type of leadership in crisis — support for vulnerable stakeholders — is not only the responsible thing to do, but also has the potential to accrue long-term value for shareholders. While other telecommunications companies are taking similar near-term actions to support access and affordability in the areas they serve, the true test of corporate leadership will be how long the COVID-19 crisis lasts.

      Bottom line: Right now, the FCC's pledge is for 60 days, but the need for social distancing and quarantine measures may stretch work and study from home arrangements beyond that time frame. How responsibly telecommunications companies answer the issues of access and affordability issues during the current public health crisis could indicate whether they are in position to build value for shareholders over the long term.