Broadband Have-nots

In one of my recent blogs I talked about a few cities that had broadband penetration north of 90%, meaning that most households in those cities have broadband. I’ve run across three such cities this year. But there are also cities with a very different story. I saw a recent article about Syracuse, New York that claimed that 66% of the homes in the city have a landline broadband connection and only a little more than half of households have a connection that meets the FCC definition of broadband at 25/3 Mbps.

It’s easy to look at the national average broadband penetration rate of 84% and think that most people in cities across the country have broadband. This is particularly true when you adjust that national average to remove the millions of rural households that still have no landline broadband option, which adjusts the national average to over 90%.

We’ve always known that there is a correlation between income and broadband subscription rates – in fact, the basic definition of the urban digital divide is households that can’t afford broadband. We also know that in every larger city that the broadband penetration rates are not uniform but are lower in poorer neighborhoods.

I am concerned that the urban digital divide is going to get worse. Most industry analysts believe that we’ll see significant increases in broadband prices over the next decade. The big cable companies have little choice but to raise broadband rates if they want to maintain the steady bottom line revenue growth expected by Wall Street. This means that’s it’s likely over time that broadband penetration rates in cities are going to drop even lower.

Cities badly want to find a solution to the digital divide that is so heavily impacting low-income neighborhoods. They know there are huge negative impacts on households without broadband. There have been several recent studies showing that school students without home broadband lag behind students with broadband, and they never close the gap. Having whole neighborhoods that can’t afford broadband will be condemning whole generations of underperforming students, helping to perpetuate the cycle of poverty.

Syracuse is considering a solution that would bring some broadband to the neighborhoods that most need it. The city has a plan to buy 18,000 streetlights that would include outdoor WiFi hotspots. These WiFi units can produce decent broadband outdoors, but the strength of WiFi signals decrease significantly when passing through the exterior walls of buildings. While any broadband is better than nothing, outdoor WiFi units are not going to provide the same quality of broadband as a landline connection. Such efforts will likely be welcomed by residents without broadband, but this is still second-rate broadband compared to that given to households that can afford to buy broadband from the incumbent ISPs.

The dilemma for cities is that there is no easy solution to the digital divide. For Syracuse, the problem is mostly affordability and not access. Most of the homes without broadband probably have the option to buy from the incumbent providers. I say most because there are still poor neighborhoods present in almost every city that don’t have the same broadband infrastructure as the rest of the city. I’ve seen estimates that there are nearly as many residences in cities with no broadband option as are rural homes without broadband. It’s hard to know for sure because the areas without broadband are comprised of an apartment building here and a dead-end street there rather than big neighborhoods without broadband.

Cities often consider building their own broadband network as a solution to the digital divide. I undertake numerous broadband feasibility studies every year, and almost every city I’ve ever worked for has universal access to fiber as one of their primary goals. However, building fiber or any broadband infrastructure is expensive, and it’s usually hard to justify the cost of providing free or low-cost broadband to low-income homes. It’s challenging in a competitive environment to make enough profit from normal broadband customers to subsidize low-income homes.

We’ve been talking about the digital divide since the late 1990s when we saw the introduction of DSL and cable modems. In my mind, the problem is far worse today than it was then since broadband has grown to become a necessity of the same magnitude as having electric or water in a home. Unfortunately, I think the urban digital divide will be growing as broadband prices climb year after year.

2 thoughts on “Broadband Have-nots

  1. Doug – When I speak I reference two digital divides. The first one (the haves and have-nots) still exists as you described in poor income areas and overwhelmingly in rural areas. The second digital divide is the haves versus the really haves. This is comparing the fiber-to-the-premise gig speeds (and super fast cable speeds) to those still operating on relatively slow DSL service and some wireless devices. While slow DSL is better than being a have-not, it still creates a major problem for rural businesses that need to compete with other businesses that have really fast access……

    While there are many programs to help rural America get better connected, those connections often fail in comparison to really fast access that is increasingly available in large metro areas. When the only large employer in a rural area relocates because of the need for better access, it can be devastating to the community…..

    Best,
    mark

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  2. I can tell you that the physical connectivity barrier you describe in your post is being addressed as we speak. Companies such as SpaceX are building a Global WiFi Network so that anyone can be connected, regardless of where you stand on the Planet, regardless of country, even if you are up in a mountain, or in the middle of the ocean, you will be connected. I can not wait to see this evolve. The Future is Bright! FutureFantastic.net

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