Just how bad is rural broadband in America, and why?
Today I watched a New America Foundation panel discussion on this subject, streamed, called “Fueling the Broadband Economy”. It was hosted by Michael Calabrese, Director, Wireless Future Project, Open Technology Institute at New America.
According to a massive data collection by the FCC, 73% of locations are served by a monopoly BDS provider — and 97% by no more than two. This lack of competition poses real problems for the future of the broadband economy, including 5G wireless networks and the Internet of Things.
It was an informative and infuriating panel, a dark portrait of just how screwed are rural Americans. I’ll share my notes, taken on the fly, and hence imperfect, until I can find a recording.
Interesting terminological note: the panel referred to broadband as “high-capacity broadband lines [or] Business Data Services, or BDS)”. I think this might be the source.
(For some meta-fun, Fairpoint’s broadband crashed while I was watching this panel and taking these notes.
So I missed a couple of minutes. “This is too meta”, as my wife observed.)
The panel began with a presentation by Dr. Raul Katz, Director of Strategy Research at Columbia Institute for Tele-Information and President, Telecom Advisory Services. He outlined recent research on wireless broadband. Some key notes:
- How do wireless providers respond to customer dissatisfaction? If customers are unhappy with service quality, providers just wait for them to leave. No improvement.
- All rural wireless providers deem 5g to be too expensive.
- Interesting: when wireless providers encounter competition, and their prices drop *50-60%*. That’s huge!
- The lack of competition leads to a degradation of service quality. Flatly stated:”This is bad for rural America.”
- Updated data on the huge differences between cities, suburbs, and the country in terms of competition:
Panelists each issued some responses and remarks.
Matt Wood, Free Press: “tell me who isn’t an internet company these days”.
(someone) from the Schools, Health & Libraries Broadband Coalition (SHLB) . He advocates for “anchor institutions”, non-businesses, often publicly funded, that are crucial for communities. In their survey, #1 issue for schools was lack of broadband – was #3. Moreover, schools and libraries are often massively overpaying (examples from Oklahoma and Florida). Another example: West Virginia hospital can’t afford to pay for broadband to make mammogram tech function.
Colleen Boothby (Ad Hoc Telecommunications Users Committee) (no web presence I can find) argued that the FCC and other policymakers saw competition coming more quickly than it turned out to, and so deregulated too quickly. Nice note: “The cloud is what we used to call the network, and it’s built by BDS services.”
Angie Kronenberg, Chief Advocate and General Counsel, INCOMPAS. “This topic is vital for the entire economy… It’s about the future of schools.”
(As I tweeted parts of this, one vital observation from aaa:
“A critical component as mostly urban schools create content for online courses.”)
- Michael Calabrese wondered about the perspective of startup companies.
- Boothby reiterated the point about lack of competition yielding bad quality of service.
- (from here I couldn’t identify speakers) If you want to launch a startup anyone outside a city, you must suffer low quality service, or just can’t get access… If you don’t have BDS, you can’t be successful. If you build out broadband, then the local economy grows.
- Some think that broadband providers argued that being allowed to have monopoly status, being deregulated, would let them invest locally. For example, AT+T’s U-verse rollout has slowed. “Competition is what spurs investment.”
- Cable (as opposed to wireless) providers tend not to respond to RFPs.
Why not a public option? FCC tried this in the 1990s. New America (I think) supports municipal broadband, but will take a long time. But there isn’t enough spectrum to support business needs. Might be ok for WiFi.
A banker argued that increased BDS was vital for her sector – to reach out to customers.
UNESCO representative: has been researching Japan and Scandinavia. Wants to know about impact of BDS on rural schools and entrepreneurship. Also: broadband to help rural people respond to climate change crises (“BDS is a must!”).
Final question was if people included tribal lands as “rural”. Yes.
A few reactions from me, in rural America:
- All of this matches our experience in Vermont, especially the lack of competition.
- None of this is new, except for Katz’ fresh data. This problem goes back a decade and more.
- I think poor rural broadband is now the accepted state of affairs. Businesses and governments have tacitly accepted this largest of all digital divides as simply how things simply are now.
- If not having broadband depresses rural economies in comparison to the rest of society, this will accelerate the divide. That’s because people will leave the country for cities, depopulating the former, especially of energetic entrepreneurs. This will make rural areas even less attractive to broadband providers. The gap will widen. The vicious circle will continue unless we break it.