The Magnitude of the Urban Digital Divide

The web is full of stories of rural areas with no broadband options, and I’ve spent a lot of time in the last few decades helping rural areas get better broadband. There has not been nearly as much coverage of the huge broadband gap in urban areas. There are a lot of urban homes that can’t afford broadband and, in many cases got bypassed when the telcos and/or cable companies built their networks.

I just saw a statistic that made me realize the magnitude of the urban broadband divide. There has always been a lot of urban homes that don’t have broadband, but the issue took on new importance when schools were forced to send students home to work. I read an article in the Democrat and Chronicle, from Rochester, New York that says that 20% of residences in New York City don’t have access to home broadband. That’s a pretty typical percentage in looking at cities across the country. The statistic that astounded me was that this translates into 750,000 students who don’t have a way to tackle schoolwork from home.

That number is mind-boggling. There are more students in NYC without home broadband than the total number of residents of Alaska, Vermont, Wyoming, or Washington DC. The article says that the percentage of homes without broadband is in the same 20% range in Rochester and Buffalo. In Syracuse, the percentage of homes without broadband is much higher at 32%. Nationwide my firm has studied urban markets where the percentage of homes without broadband ranges from under 10% to as high as 35%.

We know the primary reasons that homes don’t have broadband. Surveys and studies over the years in different markets have uncovered the same list of primary reasons homes don’t have broadband. Some homes simply aren’t interested in broadband and wouldn’t use it if was free. Some homes have low broadband needs and are happy with what they can get from a cellular plan. The biggest single barrier is the price – broadband has grown to be more expensive over time and many homes have a hard time justifying paying for broadband when they are struggling to pay for food or rent. Some homes can afford broadband but can’t also afford to keep a working computer in the home. Some people don’t know how to use a computer and need training in basic computer skills. The last reason we see given for not having broadband is a dislike for the way that ISPs and social media misuse personal data.

Around the country, some communities have found solutions for some of these problems. The gigantic challenge is how to apply solutions at the scale of a big city. How can a city provide digital literacy training on computer skills to several hundred thousand people? How do you get hundreds of thousands of computers into homes that need them? And the big dollar question is how to subsidize the cost of a monthly broadband connection to half a million homes.

What’s scary is that every other city is similar, with some in even worse shape than New York City. How do you scale up and provide solutions when the universe of people on the wrong side of the digital divide is 10 million to 20 million?

Local communities have tackled some of these issues during the pandemic. I’ve talked to rural counties that are making sure that every student has a computer at home and that every student has enough broadband to connect to school servers – usually using cellular hot spots. However, local governments are not going to be able to keep paying the fees for home broadband – even in a small community that will add up to a lot of money over time.

We can’t shy away from tackling digital divide issues just because the problem is so large and is found in almost every community. Local solutions can make a real difference, particularly in smaller communities – but the magnitude of the digital divide is too immense to easily tackle in larger cities.

Who Should Solve the Digital Divide?

Adjit Walia, a Global Technology Strategist at Deutsche Bank suggested in a recent paper that it’s in the best interest of US tech companies to tackle the digital divide. He says that those companies rely on a computer-literate public and workforce and that they ought to take a small sliver of their earnings and invest in students today before they fall on the wrong side of the digital divide.

By tech companies, I assume Walia is talking about Google, Amazon, Facebook, Apple, and the hundred other large corporations that make their money on software and the web. Walia cites a statistic that 61% of existing US jobs and 69% of new jobs require digital literacy and that the tech companies need to be proactive to help make sure that America has the workforce needed for these companies to continue to thrive. I find it interesting that his argument looks at closing the digital literacy gap as an investment that will yield a high return for these companies. I’ve always thought this was the case and that we are never going to solve the digital divide if doing so is viewed somehow as charity.

Walia is specifically referring to the millions of urban students that don’t have home broadband or computers. We have ample evidence that kids without digital tools at home fall far behind other students in achievement. A recent study from the Quello Center at the Michigan State University quantified the impact of the computer gap in a study that neutralized the impact of poverty. The scariest finding of that study is that 11th graders without home computers have the average equivalent digital literacy of 8th graders with home computers.

Walia is proposing a $15 billion plan to be spent over five years. He proposes the solution has three components.

  • He recommends subsiding broadband connections to homes through programs offered by the big cable companies. He says the tech companies should invest $1 billion per year in this effort.
  • He proposes a program to get computers into homes that he estimates at around $1 billion.
  • Finally, the most expensive part of his proposed solution would be a one-year training module for students and adults in the affected households in digital literacy. He estimates the cost of this training at $9 billion over five years.

This is an intriguing idea and I hope that some of the tech companies step up to the concept. Every generation of kids who graduate with poor digital literacy skills is going to struggle for life in an economy that is moving more and more to digital skills.

His solutions are not new, and anybody involved in digital literacy has been seeking these same three solutions for several decades. There are numerous local programs that help kids in cities around the country, but we’ve never had the funding to do this right.

It’s easy to talk about $15 billion as it is an unachievable and gigantic goal. Walia pointed out that the stock value of the biggest tech firms increased by over $2 trillion just since the start of the pandemic. This is an industry that could easily afford to give back some of their earnings, since, as Walia argues, the investment made now will repay these companies many times over through having millions of more citizens who are part of the digital economy.

Walia’s appeal is not just that solving the digital divide is the right thing to do. I doubt you can find anybody who doesn’t understand the consequences of generation after generation of kids who lag behind their peers due to something as simple to fix as broadband. What I like is that Walia has made this an appeal to the pocketbooks of the big companies – and I hope they are listening.

A Tale of Tackling the Digital Divide

A new book came out in November that tells about one of the first attempts to solve the digital divide on a large scale. The book is The Charisma Machine: The Life, Death, and Legacy of One Laptop per Child published by MIT Press and available on Amazon and other places online.  In 2005, Nicholas Negroponte, the founder of MIT Media Lab created a program that he hoped would solve the digital divide in the third world. The program was called One Laptop per Child (OLPC) and delivered inexpensive laptops to children between the ages of 6 and 12 in third world countries.

The program was nearly a complete bust. The stripped-down computers were produced for a price of about $100. A third world country had to come up with the money to buy the computers, and many did, and over 3 million computers were sold. But the realities of using computers in the third world became quickly apparent. Many students didn’t have access to electricity – the laptop came with a hand crank that could be used to charge it, but it didn’t work very well. Computers also broke and there was no process in place to repair computers with problems.

The biggest failure came due to a lack of adult supervision and training for using the computers. For example, in Paraguay, the most successful trial of OLPC, teachers make half the minimum wage in the country and very few of them understood the computers well enough to teach children how to use them. In Africa, the teaching role often is done by mothers who had no training on how to use a computer.

There was also very little Internet access in these third world countries in 2005 (and many places are still without access). Only a small percentage of children had access to the Internet and without that, there wasn’t a lot of things to do on the computers other than play some simple games or attempt to write code – something most kids had no idea how to do.

Proponents of solving the digital divide now understand that there are three components in a fully successful digital divide program. Just as with OLPC, many schools in the US now have programs that give laptops or tablets to all students – many who don’t have a computer in their homes. Teachers supply the training and context for using computers, and teachers get intensive training on using computers as part of the overall curriculum of the schools. These programs also have ways to deal with broken or lost computers.

Most school systems still haven’t found a solution for the third leg of solving the digital divide – getting broadband access into the homes of children with computers. We now call this lack of home broadband the homework divide since children without home broadband access lag behind other students, even when all have access to the same computers and computer curriculum.

There are places that are tackling the homework divide, but in most communities, that’s the hardest and most expensive part of solving the digital divide. I wrote a blog earlier this year talking about the program in Buffalo New York to bring WiFi into the homes of thousands of students without access to broadband. Many communities are looking at similar solutions. Some of the cities that have built fiber-to-the-home have a low-income product to promote getting broadband to school children.

The folks behind OLPC had good intentions. Today there are a host of people with experience in solving the digital divide who could have told the program it would fail. Solving the digital divide is not easy and it is not cheap. A successful digital divide effort needs to provide a lot more than just computers to be successful. There is a tiny fraction of kids who can run with computers without much help. But the vast majority of students need help to learn how to use a computer – and the training must be done in a way to motivate kids to stick with it.

This is not a cheap book, priced at over $20 for kindle and $33 in paperback. However, it’s an interesting read and worth it to anybody thinking of tackling the digital divide. The OLPC program made almost every mistake possible and the book is a primer of what not to do to solve the digital divide. I kept wanted to leap into the screen yelling, “No, no, no”, to the mistakes made by the program.

The Census Bureau and the Digital Divide

John Horrigan recently wrote an interesting article in The Daily Yonder that cited the results of a survey done by the Census Bureau. The agency conducts an annual survey called the American Community Survey (ACS) of 3.5 million households. In recent years the survey has included a few questions about broadband. The most recent ACS survey included questions about the digital divide. The results are at first glance a bit surprising.

The survey shows that more than 20.4 million homes have no broadband subscription at home. The survey shows that 5.1 million homes with no broadband connection are rural and 15.3 million homes are non-rural. Anybody who tracks rural broadband instantly doesn’t think those numbers can be right. However, the Census Bureau uses its own definition of rural which is different than the way most of the world thinks or rural versus urban.

According to the Census Bureau definition, rural is everything that is not urban. The Census bureau looks at the country by regional clusters of population. They count two kinds of urban areas – urbanized areas (UAs) are clusters with 50,000 or more people and urban clusters (UCs) which have between 2,500 and 50,000 people. Most of us would consider many of the UCs to be rural because within this category are a lot of rural county seats and the immediately surrounding areas. The Census statistics count a lot of people who live just outside of towns as urban when our industry considers homes past the last cable company connection as rural.

Horrigan interpets the results of the Census Bureau survey to mean that affordability is a bigger reason today than connectivity for why people don’t have broadband. He reached that conclusion by considering a recent Pew Research poll on the same topic that shows that more homes cite reasons other than availability as reasons they don’t have broadband.

The Pew Research survey asked households why they don’t have broadband. Respondents could supply more than one response.

  • 50% claimed that price was a major factor and 21% cited this as the primary reason.
  • 45% said that their smartphone could do everything they need.
  • 43% said they had good access to the Internet outside the home.
  • 31% said they couldn’t afford a computer.
  • Only 22% said that they couldn’t order a broadband connection, and only 7% said that was the primary reason they didn’t have broadband.

The Census Bureau also correlated their results with household income, and it’s not surprising that low-income households have a much lower broadband connection rate. The Census Bureau survey showed that only 59% of homes that make less than $20,000 per year have broadband. The subscription rate for all households making more than $20,000 is 88%.

Interestingly, the FCC doesn’t ask why people don’t have broadband. They interpret their mission to measure broadband availability and they count homes with or without broadband connections. This raises a few questions. What exactly is the FCC’s mandate from Congress – to get America has connection to reach the Internet or to make sure that America makes those broadband connections? I read the FCC’s mandate from Congress to have some of both goals. If availability is not the primary reason why homes don’t have broadband, the FCC might get more bang from their buck by putting some effort into digital inclusion programs. According to the Horrigan article, there are now more homes that can’t afford broadband than homes that don’t have a connectivity option.

This implies the need for a much-improved Lifeline Fund. The current Lifeline program is likely not making a big difference in digital inclusion. It provides a small monthly subsidy of $9.25 per month for qualifying households to save money on either their telephone bill or their broadband bill. It’s becoming increasingly hard to qualify for Lifeline because the big telcos like AT&T are backing out of the program. Some cable companies provide low-cost cable lines to homes with school students, but to nobody else – and cable companies don’t operate outside of towns.

In addition to a more effective Lifeline program, digital inclusion also means getting computers into homes that can’t afford them. I’ve written before about the non-profit group E2D that provides computers to school students in Charlotte, NC. Perhaps some of the Universal Service Fund could be used to assist effective groups like E2D to get more computers to more households.

My firm CCG conducts surveys and we’ve seen anecdotal evidence in a few recent surveys in poor rural counties that a lot of homes don’t buy the slow DSL option available to them because of price. These homes tell us that price mattered more than connectivity. I don’t have any easy answer for the best way to promote digital inclusion. But there are folks in the country who have made amazing progress in this area and perhaps the FCC should consider giving such groups some help. At a minimum, the FCC needs to recognize that now that most homes have a broadband connection that price is a major barrier for the majority of those who are not connected.

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.

San Jose Tackles the Digital Divide

As a country we have done well with 85% of households in most areas now buying some form of broadband connection. But that still means that 15% of homes don’t have broadband. Certainly there are some homes that don’t want broadband, but it’s clear that a significant percentage of those without broadband can’t afford it.

Affordability is going to become more of an issue now that we see a strategy of the big ISPs to raise rates every year. I don’t think there’s much doubt that the cost of broadband is going to climb faster than the overall rate of inflation. We recently saw Charter raise the rate of bundled broadband by $5 per month. Wall Street is crediting the higher earnings of several big cable companies due to the trend that the companies are cutting back on their willingness to offer special prices for term contracts – I think the cable companies are finally acknowledging that they have won the war against DSL.

San Jose is no different than any big city in that it has big numbers of homes without broadband. The city recently estimated that there are 95,000 residents of the city without a home broadband connection. The city just announced a plan to begin solving the digital divide and pledged $24 million to kick off the effort. They claim this is the biggest effort being taken by a major city to solve the digital divide.

The digital divide became apparent soon after the introduction of DSL and cable modems in the late 1990s. Even then there were households locked out from the new technology due to the cost of buying broadband service. The digital divide gets more acute every year as more and more of our daily lives migrate online. It’s grown to become unimaginable for a student to have an even chance in school without access to broadband. Anybody with broadband only has to stop and imagine for a second what it would be like to lose broadband access – and then realize that there are huge numbers of homes that are missing out on many of the basic benefits that those with broadband take for granted.

The San Jose plan is light on detail at this early stage, but it’s clear that the city will be looking for infrastructure plans to extend broadband rather than subsidizing service from incumbent ISPs. Consider the mayor’s stated vision for broadband:

“Ensure all residents, businesses, and organizations can participate in and benefit from the prosperity and culture of innovation in Silicon Valley . . . Broaden access to basic digital infrastructure to all residents, especially our youth, through enabling free or low cost, high-speed, 1 gigabit or faster broadband service in several low-income communities, and increasing access to hardware, including tablets and laptops, for low-income students.”

The city won’t be tackling the issue alone and is hoping for involvement from the business and charitable organizations in the city. For example, the city is already working with the Knight Foundation that has been addressing this issue for years. The city is interested in technologies like Facebook’s terragraph wireless technology that plans to use 60 GHz spectrum to create fast outdoor wireless broadband.

The city recognizes that there are no instant fixes and already recognizes that it might take a decade to bring fast affordable broadband to everybody in the city. I’m sure that $24 million is also just a downpayment towards a permanent broadband solution. But this plan puts the city ahead of every other major metropolitan area in the willingness to tackle the problem head-on.

There has been a cry for solving the digital divide for twenty years. Some communities have found solutions that help, like the charitable effort by E2D in Charlotte, NC that is bringing laptops and wireless broadband to large numbers of homeless and low-income school students. But no city has directly tackled the problem before with a pledge of serious taxpayer funds to help find a solution. It’s been obvious from the beginning of the digital divide discussions that it was going to take money and broadband infrastructure to solve the problem. I’m sure that many other cities will be watching San Jose because the broadband gap is becoming a significant contributor to creating an underclass that has less access to education, healthcare and the chance for good paying jobs. I’m willing to make a bet that the long-term economic benefits from solving the digital divide in San Jose will be far greater than the money they are putting into the effort.

The FCC and the Digital Divide

The current FCC Chairman Ajit Pai talks a lot about his commitment to solving the digital divide and to bring broadband to everybody in the country. Chairman Pai has now made numerous visits to rural America and to poor communities and has repeatedly promised that this FCC is on board with finding broadband solutions for everyone. Yet there are numerous actions by this FCC that tell a different story.

Redefining Broadband. Last year the FCC considered changing the definition of broadband – a change which would have drastically lowered the count of households without good broadband The FCC suggested that 10/1 Mbps cellular broadband is equivalent to a 25/3 Mbps landline connection. This change would have reclassified millions of homes as having access to broadband and would have instantly ‘solved’ a huge portion of the digital divide without changing anybody’s broadband. The FCC is required by Congressional edict to set policies that bring broadband to all, and their solution was to unilaterally declare that millions of homes served with only cellular broadband needed no further FCC assistance.

The public and the industry rebelled against this suggestion and the FCC backed down. However, the FCC is required by Congress to examine the availability of broadband every year and they will have annual opportunities to redefine broadband and recalibrate the way we count those on the wrong side of the digital divide. One has to only talk to a rural household trying to run their home broadband from a tethered cellphone to understand the ridiculousness of this idea. The high cost, low data caps, slow speeds and high latency make cellular broadband an extremely expensive and unsatisfactory substitute for landline broadband. There are many people who elect to use only cellular data, but that’s not the same thing as assuming that a cellphone connection can provide enough broadband for the typical home.

Lifeline Program. This FCC seems to be trying to eliminate or greatly restrict the Lifeline program. It’s clear that Chairman Pai would like the program to go away completely and the FCC has been whittling away at the program.

First, they stopped accepting new applications for carriers that want to join the Lifeline program. I know of two municipalities that planned to expand their broadband networks to thousands of low-income homes and offer $10 – $20 broadband that would have been enabled by the $9.95 monthly Lifeline subsidy. They were dissuaded when the FCC made it clear they were not likely to approve new Lifeline providers.

The FCC also changed the rules making it hard or impossible for MVNOs (wireless resellers) from receiving the Lifeline subsidies. These companies were the primary proponents and sellers of low-cost cellular phones and data plans for low-income customers. For example, there are MVNOs that provide a low-function phone, and a limited amount of voice and data to the homeless for the $9.95 reimbursement from the Lifeline fund. There have been numerous testimonials how these phones have improved the quality of life for the homeless by providing them with access to social services and allowing them to make phone calls or texts. Blocking these carriers from Lifeline kills this kind of initiative.

The FCC also eliminated the additional $25 per month from the lifeline program that was available to low-income natives living on tribal land. Eliminating this subsidy and also restricting the Lifeline funds to only facility-based carriers is having the effect of making cellphones unaffordable in some of the poorest places in the country. Even the big cellular companies like AT&T and Verizon opposed this change to the Lifeline fund.

Eliminated Title II Regulation. Perhaps the most damaging change the FCC made was to eliminate all FCC regulation of broadband by eliminating Title II regulation. This FCC order is referred to as the net neutrality order, but there are a number of aspects of the order that have nothing to do with net neutrality.

The FCC removed itself as the watchdog on all aspects of broadband including pricing, data caps, disclosure of practices and policies, etc. The FCC instead shuttled broadband issues to the Federal Trade Commission – an agency that can punish companies which badly abuse the public, but which cannot set proactive policies.

We are poised to see big future increases in broadband prices. That’s the only way that the big monopoly ISPs can continue their historic revenue growth. The big ISPs have hit a wall with slowing numbers of new broadband customers and sinking cable TV and telephone revenues. Rising broadband prices will do more harm to universal service than any other policy. One Wall Street analyst last year suggested that Comcast’s basic broadband price ought to be $90 – something that would drive millions of homes from landline broadband. The FCC has removed themselves as broadband regulators, meaning that the big cable monopolies are going to be free to do what monopolies do and raise rates to maximize profits. Even if the FCC never directly regulates broadband prices they have many other ways to pressure big ISPs to act responsibly – but they’ve given away their regulatory authority and any regulatory leverage is gone.

WiFi Kiosks

One of the first thing a visitor to New York City will notice these days is the proliferation around the city of LinkNYC kiosks. There are now about 1,300 of the 9.5 foot tall kiosks scattered around the city with hopes eventually have 7,500 of them. The kiosks are being installed in sites that used to have public payphones.

The kiosks offer a range of connectivity and other services. Each kiosk offers a free blazing fast gigabit WiFi hot spot. Each terminal has a phone that can be used to make free calls to anywhere in the US and allows for calling cards to be used for international calling. There is a button for an instant connection to 911. Each device has a tablet that can be used to access city maps, directions and other services. The kiosks off a fast charger for cellphones and other devices.

Probably most striking about LinkNYC are the two large 55-inch high definition displays on each side. The screens are used to display local ads and public service announcements. The business model for the kiosks relies solely upon advertising revenues from these screens.

The launch of the kiosks was not without some issues. Early kiosks allowed for web browsing on the tablets and there were reports of crowds using the kiosks to view pornography. There are concerns from privacy groups that the network can be used to track the 2.7 million people who have signed up to use the kiosks. The system is essentially a big ISP in terms of being able to match web browsing habits with users who log onto the network.

The kiosks have the potential for more uses in the future. Since they have fast connectivity they are natural places to collocate 5G small cell sites. There was talk when the project started of using the kiosks as platforms for municipal security cameras, although it doesn’t seem like there is much public support for that concept.

One interesting aspect of LinkNYC is the ability to tackle at least some portion of the digital divide in the city. The homeless, or those who can’t afford home broadband can gain access to the web through the WiFi connections at the links. Anybody with a WiFi-enabled phone can be connected to the web or make and receive phone calls without having to subscribe to a cellular plan. The kiosks are bringing some level of Internet access to those who otherwise might never have it.

There are obvious drawbacks to using the kiosks to solve the digital divide. The devices are outdoors and only the hearty are going to use them for very long during the winter. While the WiFi is fast, this isn’t going to make it easier for kids to do schoolwork or for people to take online training or do anything else that takes much time.

I’ve also been wondering how viable these kiosks might be in other cities? New York City is unique in that it’s both the largest US city and also one where people walk everywhere. That means a lot of potential viewers to support an advertising-funded model. Something similar is being built in London. How many other places in the US have the demographics to support this same funding model? Places like San Francisco, parts of Chicago and other major cities come to mind – but none of them have the same potential as New York City. There are other places that have a lot of people, like college campuses, but students are already connected to the web.

The idea is probably not going to be financially viable in more places until some other way to help fund them is found. There are cities that are probably willing to pay to support part of the cost of these systems – many cities have been searching for ways to expand public WiFi access. Getting the wireless companies to install 5G cell sites could be another difference maker. I’m sure that if these platforms become more widely available that other entrepreneurs will find ways to monetize them.

You have to give kudos to New York City for tackling this. Having kiosks spread all over the city is bringing benefits to citizens and providing access to those who would otherwise not have it. I wonder, though, if the city would be willing to step in to keep these operating if this trial is not financially sustainable? Cities have found many times that it’s not easy to kill a service that is widely popular.

One Computer at a Time

We’ve been talking about the digital divide now for decades. There is still a big gulf in our society between homes with broadband, computers and the knowledge to use them and those without. In my view we are now in crisis mode – school children that don’t have computers and broadband are at a massive disadvantage compared to their peers and are nearly destined to fall behind and fail.

I recently ran across a group here in North Carolina that is taking big strides to solve the problem in the greater Charlotte area. The non-profit E2D (End the Digital Divide) has now given laptop computers to over 4,100 families with school kids and has made a serious dent in the digital divide in the area.

The organization has taken a several-prong approach to making this happen:

  • They are soliciting used laptops from businesses in the Charlotte area. Most big businesses replace laptops every few years and most of them have been ending up in the landfill. Now a number of businesses send all of their used laptops to E2D.
  • Used laptops need to be refurbished and E2D started several computer labs in area high schools where they hire students at a decent wage to refurbish the computers and install new software. The purpose of these labs is not only to get the laptops ready to distribute, but they are providing technical training for kids that is helping them move on towards college or a technical career.
  • Households that get a new computer also get a live tutorial and technical support to best take advantage of the new laptops.
  • Finally, the Charlotte area has a lot of homeless families and there are thousands of homeless kids in the area. E2D has partnered with Sprint to provide mobile hot spots and data plans that are providing broadband access to homeless students and others with no broadband.

I’d encourage you to browse their website.  It’s a great story and you ought to view the short video that’s on their home page.

The whole concept got started a few year ago when 12-year Franny Millen asked her father how kids without computers can keep up with schoolwork. She wanted to know what could be done about the problem and resolved to fix it. Her father, Pat Millen, founded E2D as a result of the challenge.

The program has already had great success. Students without computers and broadband are noticeably behind their peers and are far more likely to eventually drop out of school and to earn far less than those who finish high school or college. Early metrics show that kids receiving the E2D computers are catching back up and closing the gap – exactly the result you would hope to achieve.

But E2D knows they still have a long way to go. While they’ve distributed 4,100 computers they estimate there are still 20,000 more computers needed in the Charlotte area to get one to every student that needs one. And those computers must all be replaced every few years.

The organization gets funding from several sources. First are the ever-growing donations of used laptops from companies. They received a $218,000 grant in 2017 and receive donations from the local community. They also hold citywide lemonade sales to involve kids in fundraising. And finally, they ask for a payment from homes that get a computer.

Pat Millen believes that their effort ought to be duplicable in other parts of the country and he would like to see the model grow. Perhaps some other communities will read this blog and take the challenge. There are a lot of young students hoping for computers.

The FCC’s 2018 Broadband Report

The FCC has released a draft the key findings from the 2018 Broadband Deployment Report that will be officially released to Congress this week. This report is usually interesting, and this year’s report includes a few big surprises.

The 25/3 Mbps Speed Benchmark. The FCC announced that it is keeping the 25/3 Mbps definition of broadband that was established by the former Tom Wheeler FCC. This is a surprise because all three Republican commissioners have been writing and making speeches that said that this benchmark is too high. Their positions on the topic garnered a lot of political pressure and it looks like, for now, that they are choosing to leave that benchmark alone. But as you will see below, they have still found a way to dilute the importance of the benchmark.

Mobile Broadband not a Substitute for Landline Broadband. There had also been a lot of discussion by the Republican commissioners to count a cellular broadband connection the same as a landline connection. They have been making the argument that many people are satisfied by a cellular connection and that functionally both kinds of broadband connection can functionally be substituted. They had suggested last year that a customer that uses either of the two kinds of broadband But the new report makes the positive statement that the two kinds of broadband are different and that there are ‘salient differences between the two technologies”.

Continuing to Track Fixed Broadband. Since cellular broadband is not a substitute for landline broadband the FCC concludes that is obligated to continue to track the deployment of landline broadband as it has done in the past. If tracking had been changed to show households that have access to either landline broadband cellular broadband, then almost everybody in the country would have been considered to have broadband.

The FCC is Meeting its Statutory Mandate to Promote Broadband. This is the zinger finding from the FCC. Reminiscent of George W. Bush’s comment after hurricane Katrina of “Brownie, you’re doing a heck of a job”, the FCC has patted itself on the back and concluded that it has already done enough to satisfy the Congressional mandate that everybody in America has access to broadband.

The FCC notes that it has taken sufficient steps to meet its regulatory mandate for improving broadband:

  • Has reduced regulatory barriers to the deployment of wireline and wireless broadband;
  • Created a Broadband Deployment Advisory Committee to make recommendations on how to better deploy broadband;
  • Instituted reforms to the high-cost universal service funds to ensure accountability;
  • Introduced a reverse auction to provide additional rural broadband funding;
  • Revised rules for special access to promote facility-based competition for business services.
  • Authorized new wireless spectrum for use for landline and satellite broadband;
  • Eliminated Title II regulation and returned to light-touch regulations.

I’m not going to pick apart all of the items on that list, and some of them, like releasing more spectrum are positive steps. However, even there this FCC seems to favor licensed spectrum for the large ISPs rather than more public bandwidth. It’s really hard to make the argument that reversing Title II regulation and network neutrality will improve broadband coverage in the country. The recommendations from the FCC’s BDAC sub-committees are nothing more than suggestions, and from what we’ve seen so far most of the recommendations from these groups are parroting the positions of the giant ISPs.

It’s too early to know if the CAF II reverse auction will prove beneficial. There is some speculation that these funds will largely be pocketed by the big cellular carriers as another subsidy to continue to replace rural copper with cellular service. This may just turn into more of the same disaster we’ve seen with the first CAF II subsidy for the big rural telcos.

When the numbers get released with the final report we’ll still see that more than 20 million Americans don’t have access to broadband. While many of these live in rural areas there are still huge pockets of unserved residents in urban areas as well.

It’s true that this FCC has been active in the last year and has made the decisions cited in this draft report. But it’s nearly impossible to see how they can conclude that America has the broadband they need and that they have satisfied the Congressional broadband mandate. I guess we’ll have to see if Congress takes exception with their declaration that the state of American broadband doesn’t need any more help.