Tag Archives: U.S. Census

Measuring Internet Adoption

We supposedly have a decent handle these days of the number of locations that can buy broadband due to the FCC broadband maps and data collection effort. While some folks will argue about the accuracy of the FCC maps, we know a lot more than we did just a few years ago. The maps are supposed to disclose where ISPs are capable of serving but not where they have customers.

But we still don’t have a handle on how many homes have broadband connections – particularly by neighborhood and geographic areas. That’s because ISPs are not required to report in that level of detail. And they shouldn’t be, because the identity of customers is probably the most important trade secret for any ISP.

Policy folks have always wanted to know more about broadband adoption rates. It’s hard to develop state and local policies and programs to get more Internet into homes without knowing specifically who does and doesn’t have broadband, computers, etc.

In September, NTIA and the Census Bureau announced the first results of a joint initiative to produce more granular data on broadband adoption. The Local Estimate of Internet Adoption (LEIA) uses a combination of existing data and statistical modeling to improve estimates of adoption by neighborhood.

Project LEIA got kicked off by making an estimate of the broadband adoption rate in every county in the country. This was done using 2022 data and was released in September 2024.  This first trial used microdata from the Census American Community Survey, ancillary data from the FCC, and new modeling techniques to make more accurate estimates.

There is work being considered to change the estimates based on the new realities of the market. Originally the goal was to count landline broadband connections. However, the proliferation of FWA, satellite, and other WISP broadband networks makes it important to count broadband adoption regardless of the network used to deliver it.

There is also consideration being given to expanding LEIA to make estimates by Census tracts. This is a lot more granular since there are 3,144 counties, but 84,400 Census tracts. Broadband availability and adoption has varied significantly by region in every county I’ve ever worked in.

The Census is also considering changes to the questions asked about broadband and computers in the American Community Survey.

How Big is the Broadband Industry

I constantly see articles that make claims about the percentage of homes that have broadband, cable TV, or telephone service. I remember an FCC report a few years ago that claimed that 88% of homes at the time had home broadband. Any time I see a statement like that, I ask the question – how many total homes are in the U.S. – a number that is needed to calculate a penetration rate. There doesn’t seem to be any consensus on that question.

Let me provide some examples.

  • Cartesian recently released a report in conjunction with the Fiber Broadband association that said as of June 2023 there were 54.1 million fiber passings, which the report says is a 45% national market penetration. That math suggests there are 120 million total U.S. possible passings.
  • RVA released another report in conjunction with the FBA that said as of September 2023 there were 69 million fiber passings, which equates to 128 million total U.S. possible passings.
  • Leichtman Research Group has for years published a list of the claimed broadband customers of the largest ISPs. As of the end of end of 2023 the biggest ISPs collectively claimed 114.7 million broadband customers. Leichtman said these ISPs represent 95% of the broadband market, which implies that there are more than 120 million broadband customers at the end of 2023. That implies a much higher number of total possible passings.
  • The FCC broadband map counts BSLs (broadband serviceable locations), which are places where a customer can buy broadband. The FCC fabric says there were 114.4 million BSLs at the end of 2023. It’s hard to know what to do with this number.

Over the years, I’ve tried to use the U.S. Census to figure this out. According to the U.S. Census Bureau, the total potential U.S. broadband market at the end of 2023 was something like the following:

Residential living units           145.8 million

Business establishments         13.6 million

Total                                         169.4 million

The business count comes from subtracting 19 million home-based businesses from 32.6 million total businesses in the Census.

Consider some other statistics that probably have some impact on figuring out the denominator of potential broadband customers:

  • CoStar, which tracks the housing industry, says there were 18.4 million apartment units at the end of 2023.
  • A recent survey from GOBankingRates said that 40% of families have a second or vacation home. Counting vacation homes is a controversial issue with the FCC maps. Vacation homes can very from multi-million dollar homes at the beach to a hunting cabin with no electricity.
  • A recent study by Lending Tree showed there are 5.5 million vacant homes just in the largest 179 metropolitan areas that are used as short-term rentals and vacation homes.

I’ve tackled this exercise periodically and have never gotten close to having a satisfactory answer. I think many of the folks who cite penetration rates are off base – as you can see from this blog, that’s not surprising. Who knows what ISPs are counting when they claim fiber passings? I have an idea that a lot of ISPs are claiming the same passings, particular for multi-dwelling units. Are folks counting businesses properly? Are they accounting for abandoned and empty homes? What’s the right way to count second homes?

The bottom line for me is to assume any statistic that claims a national penetration rate for a  broadband statistic is not accurate – possibly badly so. This doesn’t imply that the folks making a claim are being deceptive – I think it just means that there is no consensus for the denominator used to calculate a national penetration rate. There are folks in academia and government who might be able to shed light on this – but I would expect that different experts will come up with different methods of counting.

Broadband for Low-Income Housing

In April of this year, Kathryn de Wit of the Pew Charitable Trusts released what I consider to be the definitive article defining the broadband gap in low-income housing. I’ve discussed her paper before, but as we finally approach the start of the BEAD grant process, I wanted to highlight the findings from her report. While BEAD grant funding is supposed to be available to bring broadband to unserved and underserved homes everywhere, I have to wonder how much funding will be provided in most states to tackle this issue – which is mostly found in cities.

I think its universally understood that homes need broadband to take part in modern life. Just in my own life, it seems that month after month and year after year, that more of the functions I do now involve broadband. Just one example, I recently had some doctor visits, and a lot of the process is now online to register prior to the visit and to get my results from lab tests. This was not part of the process for my doctor just a year ago – but seemingly everything we do is migrating online.

Pew interviews with low-income households showed that some of the most important benefits of broadband for low-income homes include reduced isolation and increased social connection, support for aging in place, access to education, health care and wellness, job training, financial services, and the opportunity to apply for and find jobs. Several major studies have documented the positive impact for students who have broadband and computers in the home.

The Pew paper describes the lack of broadband for low-income housing as being the result of several issues. First is that ISPs, in many cases, are not building fiber or other modern infrastructure to subsidized housing. When an ISP builds fiber near a low-income apartment building, it often bypass the building and don’t offer fiber. While ISPs won’t publicly say it, this is due to an expectation of low returns on the investment of building a fiber drop, wiring the units, and providing the electronics.

Another issue is a shift away from community technology centers – places where WiFi broadband and computers are made available to the public. This is a movement that was already underway before the pandemic and which became the norm during COVID shutdowns. This means there must be a bigger emphasis on getting broadband and computers into living units.

But the biggest issue continues to be affordability. Pew research from 2021 showed that 43% of households with incomes under $30,000 did not have a broadband connection – which compares to 8% for homes with incomes over $75,000 per year. 45% of people without home broadband said they can’t afford a monthly broadband subscription, and 37% said they can’t afford a computer. The household income issue is even more acute in public housing, where the average household income in a 2016 study was just over $14,000 per household.

A large survey conducted by the NTIA of homes without broadband showed that the average amount that those living in subsidized households said they could afford was just $10 per month, although over half of homes said they couldn’t afford any amount. A 2021 survey by Everyone On shows that 40% of households with incomes of $50,000 said they can’t afford broadband, while 22% said they could afford to pay as much as $25 per month.

As you might imagine, there are a lot of challenges in getting better broadband to public housing:

  • Broadband subscriptions are not included in the HUD utility allowance. This is a funding mechanism that covers electricity, gas, and water fees in public housing. It’s time to recognize that a broadband subscription is a household need and not a luxury.
  • While BEAD grants theoretically cover bringing broadband to apartment buildings that need it, it’s a challenge to prove the areas are underserved since urban maps often claim ubiquitous broadband coverage from cable companies. The BEAD process is also incredibly unfriendly for filing grants for small areas like a single building due to the complexity of the requirements.
  • ACP funding has allowed many low-income households to get broadband. But unless Congress acts soon, that fund will run dry by next spring. The ACP rules also require individuals to apply for the subsidy. In a low-income housing building, everybody qualifies for ACP by definition, yet there is no mechanism for enrolling a building in ACP. Most other benefits for low-income housing are funded by the building instead of by individual tenants.

I’ve predicted for the last several years that the next big push for broadband connectivity will be in cities. As states start allocating rural grants for BEAD, it will likely become obvious that little has been done to help most cities. I think this is going to be a harder issue to solve than the rural broadband gaps because the big cable companies are going to fight anybody that tries to bring broadband into what they consider as their turf – even where they aren’t serving. But if the goal is to get everybody onto broadband, this is an issue we need to tackle and solve.

Working at Home Here to Stay

The U.S. Bureau of Labor Statistics released a report in June that indicates that the percentage of people working at home, which grew rapidly during the pandemic, is still much higher today than before the pandemic.

The U.S. Census and the Bureau gather this data by interviewing thousands of workers and asking how they spent the previous 24 hours. The survey not only gathers information on work habits, but also statistics on time spent on leisure, housework, and other activities.

Here are some of the key statistics from that report:

  • 34% of workers did some or all of their work from home in 2022. That has dropped – during the pandemic, 42% of workers worked at home in 2020 and 38% in 2021. But before the pandemic, the percentage of workers who worked at home was 24% in 2018 and 2019.
  • Working at home seems to be tied to having higher levels of education. 54% of adults over 25 years old with a bachelor’s degree or higher worked at home in 2022 compared to 18% of those with a high school diploma or no degree.
  • Women are more likely to work from home. 41% of women worked from home in 2022 compared to 28% of men.
  • The average person who said they were working from home did so for 5.4 hours per day.

Most labor experts are interpreting the survey results to mean that there has been a permanent shift in the way that people work. In 2022, there were 42% more people working at home than before the pandemic. To put that statistic into perspective, there are roughly 164 million adults in the U.S. workforce. This means that in 2022, almost 56 million people worked at home, up from 39 million before the pandemic. That’s an increase of over 16 million additional people working from home.

It’s possibly a little early to predict where the percentage of those working from home will stabilize, but it seems unlikely that the percentage will ever return to the pre-pandemic levels.

The statistics show a big gap in those working at home by education level. There are three times as many people with a bachelor’s degree or higher working at home than those without. It’s not too hard to conjecture that a lot of those working from home are likely to be working on computers and needing a good broadband connection.

The disparity between the percentage of men and women working at home probably has a lot to do with the daycare crisis in the country. I’ve read numerous articles describing the cost and the difficulty of finding daycare. In those articles, many women talk about working at home as a way to cope with daycare issues.

I’ve seen several other surveys over the last year that have interviewed generation Z and millennial workers, and a large percentage of these generations do not want to work in the classic office environment. I have to think over the next decade that this trend will continue to nudge the percentage of folks who work at home even higher.

My consulting firm conducts a lot of interviews about broadband usage, and we are still finding a lot of homes that don’t have adequate broadband for working at home or for students doing homework. I regularly participate in online discussions with folks working from home with a poor broadband connection who struggle to maintain an online chat session. I have to think that as we bring better broadband to millions of rural locations, the percentage of homes that will include somebody working at home will continue to climb.