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Universal and Affordable Broadband in the States

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Monday, February 26, 2007

Conference Call: Universal and Affordable Broadband in the States

On Thursday, March 1st, 2007 at 4pm EST, Progressive States Network will be sponsoring a nationwide conference call to discuss further how to promote Universal and Affordable Broadband in the States. We will discuss details and strategies on legislation to map existing access in your state, requirements in video franchising laws to promote build-out and more comprehensive programs being promoted by state leaders.

For those who can't join our call, please sign up to receive further updates from Progressive States.

Joining us will be representatives from FreePress, the Communication Workers of America, and state legislative leaders sponsoring key legislation.

Details:
Thursday, March 1st 2007
4pm EST/1pm PST
1-800-391-1709 (Conference ID# 709424)
Please RSVP at
http://www.democracyinaction.org/dia/organizationsORG/progressivestates/event/index.jsp?event_KEY=24384

Valuing Families

Universal and Affordable Broadband in the States

The United States, having largely invented the Internet, is becoming a global also-ran in deploying high-speed Internet broadband for its citizens.  The dirty secret is that US federal policy is a debacle, a massive failure that has left most American families with access to relatively slow, expensive broadband services and left many other families with no high-speed Internet available at all. 

This is an economic and social tragedy, since, as we discussed last Fall, high-speed broadband promises both new economic growth for communities and potentially massive savings on medical and energy costs.  

Luckily, state governments are no longer waiting for the federal government to act, and many are working to make universal and affordable broadband a reality for their citizens.  At the same time, there is some danger that states could make the situation worse by increasing the digital divide if they don't establish strong broadband build-out requirements as part of video franchising and other regulatory rules in their states.  This Stateside Dispatch will highlight new state initiatives that are addressing these challenges of broadband deployment in the states.

More Resources

Valuing Families

Failure of Federal Policy

Multiple reports have documented how the United States has lost its global edge in the race to bring high-speed Internet to its citizens.  Just a few measures of this failure include: 

  • US Falling Behind in International Rankings: From 2002 to 2005, the U.S. fell from 11th to 16th in the world in terms of the percentage of residents with broadband subscriptions. Japan, Korea, Sweden, Canada, and Switzerland are just a few of the countries with wider access to high-speed Internet for their citizens. 
  • Slower and More Expensive Broadband Access: The broadband available to US consumers is generally slower and more expensive than in other countries. In the U.S., telephone-based DSL broadband reaches speeds averaging 1.5 to 3.0 mbps (megabytes per second) at a price averaging $30-$50 per month while cable modems in the US generally reach speeds of 3-5 mbps for $40-$50 per month. In Japan, by contrast, the cost of an average connection with the speed of 26 mbps costs roughly $22 per month, meaning the Japanese have 8 times the speed at roughly 1/2 of the cost.
  • Digital Divide: While more than 62% of households with incomes over $100,000 have broadband at home, just 11% of households with incomes below $30,000 subscribe.
  • Low Investment in Telecommunications: This broadband failure reflects a broader under-investment by both the public sector and private firms in upgrading our telecommunications infrastructure.  As the graph below emphasizes, the US is investing a tiny fraction of its GDP in telecommunications compared to other countries.

     

    To get some sense of what we are missing out on in the United States, you can compare your personal broadband speed to what's available in the rest the world using the SpeedMatters Speedtest.

    While some blame the challenge of reaching rural populations as the reason the US lags behind other countries, an analysis by FreePress and Consumers Union emphasizes that many countries with a higher non-urban population than the United States still have higher broadband deployment than the US. They make clear that it's been the lack of political will in the United States that has been the cause of our plummet in the international technology deployment rankings.

    In fact, criticism of the failure of US policy comes not just from outside advocacy groups but from top regulatory officials.  In a Washington Post op-ed last fall, Federal Communications Commissioner Michael J. Copps blasted federal failures:

    "America's record in expanding broadband communication is so poor that it should be viewed as an outrage by every consumer and businessperson in the country. Too few of us have broadband connections, and those who do pay too much for service that is too slow. It's hurting our economy, and things are only going to get worse if we don't do something about it."

    More Resources

    Valuing Families

    Mapping Broadband Access

    Here's the most absurd measure of federal failure: federal regulators don't even know who has high-speed access and who doesn't --or how fast their access really is.

    Incomplete Federal Data: Using July 2005 data, the Federal Communications Commission declared that 99 percent of the population lived in areas with high-speed Internet access, but this was based on industry data that assumed broadband access even if just one person in the zip code had access. And the FCC defines "high-speed" access as anything more than 200 kbps (just a couple of times faster than dial-up access) compared to other countries which define "high-speed" as five times the US standard-- and where speeds in Japan can reach 2000 times faster the FCC standard.   So the feds have little idea which neighborhoods really have access to broadband and no idea what speeds they have available.

    The Government Accounting Office in a May 2006 report argued that this poor data collection made the FCC information "[not as] useful for understanding the status of broadband deployment across the country."(p. 10)  The GAO cited the example of Kentucky, where the FCC claimed in 2005 that 96% of communities had broadband access, yet more detailed state-specific mapping found that only 77% of Kentucky households had access to any form of broadband service at the time.(p. 17)

    Independent State Broadband Mapping: The reason the GAO had independent Kentucky data to measure against the pathetic FCC data is that a state-level organization, ConnectKentucky, had established a mapping project in 2004 to measure who actually had broadband access in the state.  Mapping access was the first step by the state in increasing access by 45 percent in two years, on track to meeting the state's goal of full broadband deployment by the end of 2007.

    Other states are now taking Kentucky's lead in working to map exactly who has broadband access in their states and how fast that access really is:

    • Maryland Delegate Herman Taylor, who represents a county just outside of Washington D.C., introduced House Bill 1069 to require any company offering high-speed broadband (defined at a more realistic level of at least 768kbps) to report down to the zip code-plus 4 level who has access, the speed of access, and the price charged for those services.  Delegate Taylor worked with the organization Public Knowledge in developing the bill.  

    • In Indiana, Rep. Scott Reske (D-Pendleton), who chairs the state Technology, Research & Development Committee, and Rep. Terri Austin have proposed HB 1662.  The bill would require Indiana's Utility Regulatory Commission (IURC) "to prepare certain maps depicting the availability of broadband service in Indiana," including the availability and cost of broadband services in each census block, along with costs to extending service to areas not currently served by broadband.   The goal is to create a visual map of gaps in access that can guide further policy in the state.

    Whatever states do on broadband policy in 2007, requiring state regulatory authorities to collect data on broadband access, speeds, and prices of service for all state residents should be a top priority for state legislatures.

    More Resources

    Valuing Families

    Build-Out Requirements in Video Franchising Laws

    Many states are rushing forward with "Video Franchising Laws" on the promise that these will speed high-speed video and broadband services in their states, but the cost of carelessly designed rules could be an increased digital divide, especially if strong universal service requirements at the local level are preempted by weak or non-existent build-out rules at the state level.

    The Danger of Cherry-Picking Customers: For example, an industry report on the Texas Video Franchising Bill, SB 5, has touted the argument that there was a small increase in high-speed video options. Unfortunately, even the fine print of the report admits this slight improvement came at the expense of community benefits previously provided and were partially due to "Elimination of Build-Out Requirements." As the report detailed, "Larger providers said they occasionally had requests to serve entire communities with voice, video, and data service [in the past]...These providers felt the statewide law had helped avoid this potential problem," ie. companies were now able to cherry-pick more profitable customers rather than covering a whole service area. (see p. 11)   Industry celebrating the gutting of local build-out requirements emphasizes why state franchising laws need to step in with their own rules to avoid reinforcing the digital divide.

    Including Build-Out Requirements: On the plus size, a number of states are demanding stronger build-out requirements in their video franchising laws:

    • California's AB 2987, enacted last summer, requires that Verizon offer video service to 25 percent of customers within two years, and 40 percent within five years, while requiring AT&T to offer video services to 35 percent of customers within three years and to 50 percent of customers within five years.  To avoid discrimination in meeting these goals, the law requires that at least 25 percent of video customers be low-income within three years, and that 30 percent be low-income within five years. While the requirements in the bill are hardly perfect, they are stronger than the build-out requirements passed in other states.
    • New York's proposed AO1423, sponsored by Assemblyman Richard Brodsky, would go beyond the California standard to require statewide franchisers to provide video service to half of the state's consumers within three years and to 85% percent within five years.  The bill would also preserve certain municipal regulatory powers, strong local franchise fees, local Public Educational & Government (PEG) channels and provide for other high-speed Internet services for local communities. 

    As state video franchising laws are debated across the country, this is a chance for states to either make strides toward universal broadband for their communities with strong build-out requirements-- or deepen the digital divide if they miss the opportunity.

    More Resources

    Valuing Families

    Expanding Broadband Access Statewide

    Beyond video franchising legislation, states are stepping up with comprehensive plans to promote broadband deployment -- a key to overcoming the underinvestment in telecommunications infrastructure in the US highlighted above. 

    Along with ConnectKentucky discussed above, another example is the Southside Virginia Regional Backbone Initiative, funded partially by Virginia's Tobacco Commission, to use high-speed broadband to revitalize the economy of Southern Virginia.  One byproduct was the creation of the Mid-Atlantic Broadband Cooperative, a non-profit public-private partnership dedicated to building new fiber optic infrastructure in the region as the backbone for broadband expansion and encouraging technology-based business expansion in the region.

    Other states are also moving forward with comprehensive broadband plans: 

    • Tennessee: Based on the ConnectKentucky model, The Tennessee Broadband Task Force spent a year looking at the status of the internet in Tennessee and concluded that rural Tennesseans often don't have access to education, employment and health care services that are available only with high speed internet connections. The panel has urged that Tennessee follow the ConnectKentucky model of public-private partnerships to increase internet access and speed throughout Kentucky. 
    • Just last week, West Virginia's Senate Transportation and Infrastructure Committee endorsed SB 748 which is also modeled on ConnectKentucky's program and would integrate the broadband deployment program into early education programs to help drive demand for use of the network.
    • In Maine, proposed legislation (LD 218) would make available $2 million in bonds and focus on creating the necessary infrastructure for high speed internet service in under-served and rural communities by building infrastructure that will create the demand for private companies to provide service. The new bill fits within Gov. John Baldacci's ConnectMe Authority program to provide broadband to 90% of Maine residents by 2010. The authority will receive funds from the universal service fund as well as USDA rural development money to further its work.
    • New York: In his inaugural State of the State address, NY Gov. Elliot Spitzer called for a Universal Broadband Initiative "to ensure that every New Yorker has access to affordable, high-speed broadband."
    • In Massachusetts, Rep. Daniel Bosley from rural western Massachusetts helped push through an economic stimulus package last year which created a state Director of Wireless and Broadband Development charged with expanding high-speed access statewide.  The new governor, Deval Patrick, has declared that broadband deployment "is not a luxury. Broadband internet access is key to the future economic growth and development of the Commonwealth." 
    • Illinois legislator, Rep. Julie Hamos, has proposed innovative legislation, HB 1258, to lease publicly-owned broadband infrastructure to private, public and non-profit organizations for local community broadband projects and use existing state grants to help communities assess their needs and create public-private partnerships to promote broadband deployment.
    • Unsurprisingly, California has one of the largest broadband expansion programs in the works. Gov. Arnold Schwarzenegger has appointed 21 technology leaders to a Broadband Task Force to help remove barriers to high-speed cable and wireless access. At least $460 million soon will be available for overcoming the state's "digital divide" with about $400 million coming from education bonds approved by voters last November.

    Beyond wired broadband, a number of states, including South Carolina are promoting statewide wireless networks as an option for state residents, highlighting the range of innovation being promoted around the states.

    More Resources

    Valuing Families

    Conclusion

    After years of neglect by federal leaders, states are taking action on broadband policy, but they need to leverage opportunities for success: mandatory mapping of what broadband services are really available to their citizens, requiring real build-out requirements in any video franchising laws, and creating comprehensive state plans for broadband expansion. 

    A 2001 Brookings Institution study estimated the widespread adoption of broadband could add $500 billion to the U.S. economy and create 1.2 million new jobs per year, but that growth will go overwhelmingly to communities that fully deploy the technology-- meaning that any digital divide we allow to remain in place will translate into an increasing economic divide between prosperity and economic stagnation. Hopefully, we will see the political will in the states to avoid that result and make universal and affordable high-speed broadband a reality for all Americans.

    More Resources

    Resources

    Failure of Federal Policy

    Free Press, Consumers Union and Consumer Federation of America, Broadband Reality Check II: The Truth Behind America’s Digital Decline (September 2006)

    Communication Workers of America, SpeedMatters: Affordable High Speed Internet for All (October 2006) and the SpeedMatters Speed Test 

    General Accounting Office, Broadband Deployment Is Extensive throughout the United States, but It Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas  (May 2006) 

    Mapping Broadband Access

    ConnectKentucky broadband inventory maps

    GAO, Broadband Deployment Is Extensive throughout the United States, but It Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas  (May 2006)  

    FCC, High-Speed Services for Internet Access: Status as of June 30, 2006

    Public Knowlege, Maryland, My Maryland-- A New Broadband Approach

    Indiana HB 1662 and Maryland HB 1662-- bills to require broadband providers to report to state authorities where customers have broadband access and the broadband speed available.

    Build-Out Requirements in Video Franchising Laws

    FreePress, Video Franchising and Other Threats to Local Control

    California's AB 2987 and New York's AO1423

    Expanding Broadband Access Statewide

    ConnectKentucky

    ME LD 218, An Act To Authorize a General Fund Bond Issue To Encourage Municipal High-speed Internet Access and ConnectME

    The Tennessee Broadband Task Force

    California Broadband Task Force

    Illinois HB 1258 to offer access to publicly-owned broadband infrastructure

    Eye on the Right

    FL: Missing votes in Sarasota not caused by machines

    It seems everything Katherine Harris touches, or has touched, turns to gold. The Florida race to fill her former congressional seat is marred by, you guessed it, missing votes; 18,000 to be exact. It should be no surprise, then, to learn that the auditor in charge of the recount is active in conservative politics, and that the Secretary of State audaciously said, "no evidence that suggests the official results are in error."

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    The Stateside Dispatch is written and edited by:

    Nathan Newman, Policy Director
    Mijin Cha, Policy Specialist
    Adam Thompson, Policy Specialist
    John Bacino, Communications Associate

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    John Bacino
    Editor, Stateside Dispatch

    Progressive States Network

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