Wednesday, May 13, 2020

Eakinomics: Universal Broadband

Today the Senate Commerce Committee will hold a hearing on “The State of Broadband Amid the COVID-19 Pandemic.” While ostensibly about the current state of broadband, it will likely become a forum for the notion of “universal broadband.” The reasoning behind universal broadband is fairly obvious: Internet-based tools have become essential to coping with the pandemic. As AAF’s Jennifer Huddleston noted, if this pandemic had hit 10 years ago, the capacity to work remotely, maintain social distance, and take classes from home would have been far more technologically difficult — if not impossible. It is easy to see that there will be a push for everyone to have access to these innovations.

But it will be easier said than done. One thing Congress can do is throw money at the problem. But taxpayer money usually comes with a complex set of requirements and regulations. As I recently argued in USA Today, the vitality of internet-based innovation is a tribute to minimizing exactly those same regulatory straightjackets.

A second thing is that limited broadband access may not be about money. As previous AAF research shows, the cost of broadband service has been less of a factor than a desire to have it at all. Now, with the advent of the pandemic and the widespread need to work and take classes from home, this preference may change. But there is no evidence yet that shows massive subsidies will get people to adopt broadband.

Third, a key part of “universal” is getting more adoption in “rural” areas. But rural is a tricky concept. As AAF research notes, “By definition, rural America is simply everything that isn’t located within a metro region, but that doesn’t mean rural America isn’t clustered into population centers. One commonly used classification scheme is the Rural-Urban Continuum Codes developed by the United States Department of Agriculture, which provides researchers with detailed residential classifications to analyze the degree of rurality and metro proximity.” Further, “There is a strong spatial component to broadband deployment, which AAF’s previous research confirms. Micropolitan cores, which are rural population cores with between 10,000 and 50,000 people, already have broad access to broadband similar to metropolitan cores. But the surrounding areas tend to show marked differences in broadband availability. Access drops quickly the further you get from a population center. In other words, many rural towns tend to have good internet access already, and it is in those population centers where the jobs are located.”

Finally, there is nothing about previous efforts that gives reason for optimism. The Department of Agriculture’s Broadband Loan Program found no impact for rural areas, and the American Recovery and Reinvestment Act’s $7 billion broadband investment had at best mixed success.

Today’s conversation will be enlightening, but setting the bar at “universal” may be a bit too optimistic. 

No comments:

Post a Comment