Our Broadband Divides -- And How to Bridge Them

Submitted on September 15, 2017

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Robbie's Round-Up for the Week of September 11-15, 2017

What's the status of the Digital Divide? And what are we doing to bridge it?

Where is broadband? And where is it ain’t? Since encouragement of universal broadband is the law of the land, these aren’t trivial questions. This week we saw new evidence about where broadband is reaching -- and new clues about how policymakers will approach making sure this critical telecommunications infrastructure reaches everyone.

Chairman Pai’s Approach to and the Rural Digital Divide: Slower, More Expensive, Less Open Broadband

Federal Communications Commission Chairman Ajit Pai has repeatedly stated that his main priority is to reduce the digital divide. He reiterated his commitment in an interview this week:

Well look, I grew up in a small town in rural Kansas on a dirt road outside of a town called Parsons. So I was keenly aware of what it was like to be on the wrong side of the digital divide...I've made it a personal mission to close the digital divide. Precisely because in some cases, these are populations that might not be profitable for the biggest competitors to serve. These are populations that may be just technically or geographically difficult to serve. But nonetheless, they are Americans, too. Every American, I believe, deserves what I call digital opportunity, and it would be very easy to simply regulate from afar and make big pronouncements. We're actually trying to solve these problems, very complex problems, with solutions that are tailored to the task.

His “tailored” solution is to rely on a light-touch regulatory approach that encourages private investment to expand broadband access. When it comes to reducing the digital divide (of both access and adoption), obvious questions arise as to whether this light-touch approach is best suited to achieve the goal. Will this free market strategy lead to true universal access? Will it adequately address other factors of the digital divide, such as adoption and inclusion? Will it effectively stop the practice of digital redlining by broadband providers?

On the topic of redlining, Chairman Pai said this week:

Digital redlining is the notion that within a certain geographic area, a company might have a business case for building out in areas A, B and C. But in area D they simply say, "We're not going to deploy there because we don't see the return on the investment," or for whatever reason. So from a regulatory perspective, we want to make sure that there are no rules standing in the way of them doing that.

Pai is suggesting that government regulations are to blame for digital redlining, as the red tape of regulation increases carriers’ costs and reduces broadband investment. Indeed, Pai demonstrated this line of thinking when he announced his proposal to roll back the FCC’s Title II network neutrality rules back in April:

Who has been most harmed by Title II? When businesses cut back on capital expenditures, the areas that provide the most marginal returns on investment are the first to go. And in the case of broadband, that means low-income rural and urban neighborhoods. As a result, Title II has kept countless consumers from getting better Internet access or getting access, period. It is widening the digital divide in our country and accentuating the practice of digital redlining—of fencing off lower-income neighborhoods on the map and saying, “It’s not worth the time and money to deploy there.”

Rather than seeing digital redlining as an obvious market failure, Chairman Pai instead blames the FCC and its Title II decision for reduced network investment. And he uses his conclusion as the rationale for deregulation -- like ending the Open Internet protections for all broadband subscribers. But Pai’s claims of Title II harming investment are certainly debatable, with Free Press' Derek Turner writing:

This claim is both false on its face — aggregate investment by publicly traded ISPs is up since the FCC’s vote — and completely illogical. Infrastructure investment is influenced by a number of factors, including interest rates and investment climates, competition and consumer demand, and of course the networks and capacities that a company has already built out. The idea that a single FCC decision could have this impact on investment is preposterous. Yet Pai continues to repeat the claim, ignore what these companies are telling their own investors, and look away from the mountain of available evidence showing that the internet economy overall is thriving since the FCC acted in 2015.

In addition to ending network neutrality protections, Chairman Pai is considering to count slower broadband offerings -- like satellite and wireless services -- in the FCC’s annual Broadband Progress Report. Why do this? If Pai can claim broadband is being deployed in a “reasonable and timely fashion”, then he is not Congressionally mandated to take action to spur deployment. Public Knowledge this week described Pai’s move as “using legal gymnastics to excuse itself from getting Americans internet access.” [For more on the FCC's Broadband Progress Report, see: Got a Smartphone? Then You've Got Broadband!] Many -- including some Senate Democrats -- are concerned that counting lower-speed mobile services as broadband will distract public and private resources away from offering new high-speed services to geographically remote parts of the country.

And, as Blair Levin and Larry Downes noted in an op-ed this week, critics fear that defining slower, data-capped mobile services as broadband at this time could help justify reversal of many Obama-era policy initiatives aimed at quickening the deployment of high-capaity broadband and Digital Age consumer protections. Chairman Pai appears to be trying to close the digital divide by redefining the rules of the game and lowering the metrics to success.

“Signs of Digital Distress”: Brookings Research on the Digital Divide

A new Brookings report released this week examined the digital divide at the neighborhood level. Notably, Brookings looks at both deployment and subscription gaps, and provides policymakers with detailed suggestions for reducing the digital divide.

A New Look at the Deployment Gap...

The Brookings report found that broadband infrastructure is far from ubiquitous, both in terms of where it operates and who subscribes to it, and that those deficits are not shared evenly across the country. The authors conclude that policymakers must understand how the national digital divide varies depending on the place.

Most major metro areas offer near-complete broadband coverage to their residents. Among the 100 largest metro areas, five in Florida and five others—ranging from Akron, Ohio to Salt Lake City, Utah—have achieved 100 percent broadband coverage for their residents.

The Brookings report cautions, though, that even among metro areas with near-universal broadband availability, deployment gaps examined at the neighborhood level can leave tens of thousands of residents without the option of broadband.

These neighborhood deployment gaps can occur because of digital redlining. Supporting these findings is research from the National Digital Inclusion Alliance, which found a pattern of "digital redlining” of low-income neighborhoods in Cleveland, Detroit, Dayton, and Toledo. [Of note, on August 24, three residents of Cleveland filed a formal complaint with the FCC claiming AT&T practiced discrimination through digital redlining.]

National broadband subscription statistics reveal a country undergoing an uneven transition to the digitally-connected economy, and illuminate a digital divide that splits along both geographic and economic lines.

Moreover, in 2016, a Federal Communications Commission report found that 39 percent of rural America doesn't have access to Internet at speeds that count as broadband. Looking closely at FCC and Census Bureau data, the Brookings report finds that more than one in four rural residents (12.7 million people) lacked 25 Mbps broadband service in 2015. While rural communities are home to just 15 percent of the nation’s total population, they accounted for 57 percent of the nation’s residents in neighborhoods where broadband has yet to be deployed—a ratio that remains roughly the same at lower speed thresholds.

…And The Subscription Gap

Slightly less than half of all households with incomes under $20,000 reported having internet access in the Census Bureau’s most recent American Community Survey. By comparison, about 93 percent of wealthier households with annual incomes exceeding $75,000 were connected. In a dozen metro areas Governing reviewed with at least 100,000 households, the lowest-income bracket was connected at roughly half the rate of all other households.

Brookings found that less than one-fifth of Americans live in a high subscription neighborhood where at least 80 percent of residents have a broadband subscription.

One metro area where the digital divide is particularly evident is the northern Louisiana region comprising Shreveport and Bossier City. Bill Robertson of the Louisiana Public Service Commission District 5 attributes much of the low internet adoption issues among poorer households to affordability barriers, although some pockets of the region remain underserved by service providers. Meanwhile, metro areas where low-income homes are most connected tend to be anchored by colleges or universities. Nearly three-quarters of low-income households in the Boulder (CO) area reported broadband internet access in the Census survey, for example.

A New Neighborhood-Level Approach

The Brookings report argues that research on neighborhood-level subscription rates confers multiple advantages for policymakers pursuing universal access to in-home broadband. "Modeling neighborhood-level indicators serves as a powerful signal for policymakers aiming to understand local subscription gaps...and to enable policymakers to more effectively target their limited resources to boost adoption among populations and neighborhoods most in need," the authors conclude.

They point out that the research confirms the need to further study “neighborhood effects” related to broadband deployment and subscription. Much like groundbreaking work under concentrated poverty and general access to economic opportunity based on where people live, neighborhood broadband conditions may have significant spillovers that impact the entire population in those neighborhoods and even the broader region.

For example, the Brookings analysis reveals income and education to be the factors most highly correlated with broadband subscription. High-subscription neighborhoods also tended to be high-income neighborhoods and have smaller shares of people with less than a high school diploma.

Critiques of FCC Broadband Reporting

The Brookings report also points out problems with how the FCC currently studies and responds to the digital divide. Federal policy overwhelmingly focuses on solving the collective action challenges around availability. Yet federal policy continues to largely overlook adoption:

The sheer scale of non-subscribed broadband households is difficult to ignore, and the fact that every community is affected—from New York City to rural Wyoming—generates political resonance and suggests the need for more targeted federal policy attention. There are clear opportunities to move adoption issues to the forefront of national policy, but current and past efforts have been patchwork. Simply put, formal policy must move beyond volunteerism.

Brookings’ policy recommendations include, for national policymakers:

Adopt policies to reduce deployment costs
Consider the role of evolving wireless technology and business practices
Move beyond stopgaps and pilots to more sustained adoption-focused funding streams and programming
Forge metropolitan/rural alliances on Capitol Hill
Leverage public data more effectively
Support further research efforts, including around technology, competition, and ownership

For local stakeholders:

Communities should use the levers they control to influence broadband availability
Collect and reflect on data to inform local priorities
Collaborate to drive adoption improvements
Develop campaigns tailored to local needs
Think locally, act regionally

The Levin and Downes op-ed strongly critiques the FCC’s broadband reporting process, and proposes an interactive broadband dashboard, one that can be continually updated with the most current information on broadband technologies, speeds, performance and coverage. They argue the dashboard should provide just the facts -- no opinions about adequacy, or timeliness. “The FCC could present the data it collects in ways that enable broadband stakeholders to improve their solutions to deployment issues. That data could be expanded to show what services broadband customers are actually buying, creating profiles that show, for example, what speeds customers with home businesses are buying in different parts of the country.”

Conclusion

True universal broadband access will require policymakers at all levels to understand the many factors of the digital divide. The neighborhood level approach could give policymakers the insights they need.

As always, be sure to keep up with broadband policy news everyday in Headlines.

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