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Broadband's Impact

Make No Mistake: Internet Content Subscription Models will come!

Why do Internet users continually resist paid content on a systematic basis? Keep in mind that many current Internet business models were built on the premise, (create the content and they will come).

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Image representing hulu as depicted in CrunchBase
Image via CrunchBase

Why do Internet users continually resist paid content on a systematic basis? Keep in mind that many current Internet business models were built on the premise, (create the content and they will come). We have all seen the sterling examples of this model with Google, Facebook, MySpace, Hulu, YouTube, along with a host of others, including news organizations betting on ad supported revenues to make a profit. While this model worked for some businesses, it has not for others. Relying solely on ad supported revenues is a weak model, as the Broadcast TV Industry found out the hard way.

Historically, news organizations relied heavily on paper subscription models supplemented with ad revenues to make their profits. Linear TV models like CNN and Fox News relied heavily on the Cable Industry’s monthly subscription models while being supplemented with ad revenues. These amounted to dual and re-occurring revenue stream models, realizing the best of revenue worlds, subscription and advertising.

I’m sure the current ad revenue based models were launched based on garnering a gigantic number of users which could be attracted to these sites based on whatever product/service was being offered. Not to mention that these models worked and trained users that Internet Content was free. But what new start-ups today are going to get the numbers needed to break-even, much less make a profit? They are few and far between and Internet junk-yards are full of great ideas based on an ad supported revenue model. One only has to remember the Dot.com era where company valuations were based, not on real revenues, but (pie-in-the-sky) business models.

The time has come with the continued proliferation of broadband Internet users, clamoring for content to distance them from a Linear TV Model, for companies to understand that Internet based subscription models will work, if the business model gives the right combination of a paid and free content model.  The Cable Industry is using this model to perfection with its TV Everywhere initiative, giving away free Internet content, if you keep their subscription based models, see (Nielsen study shows there’s a long road ahead to get people to pay for online content). In the interim, these companies will surely test online dual revenue Internet models of ad and subscription, if not in somewhat of gradual scenario, since Linear TV continues to produce great profits.

The bottom line to subscription based content over the Internet is that consumers want a quality experience at a reasonable price, based on competitive market forces, and one where that do not feel trapped in a spiral of upward rate adjustments. This is where the Linear TV model got into trouble, see (Cable Is Saved?). While it produced great content and hundreds of programming choices, it became too expensive and forced consumers to subscribe to channels they didn’t want or need. But here lies a new frontier where innovation and competition can solve consumer demand at a relative price model. So what do existing and new companies wait for; a realistic business model where investors are willing to put up capital but receive acceptable returns, where consumers will both accept and follow an Internet based subscription model? It’s time is coming, so turn up the bytes and let the good times roll!

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Education

Metaverse Can Serve as a Supplement, Not Replacement, For Educators: Experts

The virtual world where avatars can meet as if they were in real life can be a companion for education.

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Screenshot of the Brookings event Tuesday

WASHINGTON, June 29, 2022 – Experts said at a Brookings Institution event said Tuesday that while the “metaverse” can go a long way toward improving education for some students, it should serve as a supplement to those educational goals.

The metaverse refers to a platform of 3D virtual worlds where avatars, or virtual characters, meet as if they were in the real world. The concept has been toyed with by Facebook parent Meta and is being used as a test for the educational space.

“The metaverse is a world that is accessible to students and teachers across the globe that allows shared interactions without boundaries in a respectful optimistic way,” Simran Mulchandani, founder of education app Project Rangeet, said at Tuesday’s event.

Panelists stated that as the metaverse and education meet, researchers, educators, policymakers and digital designers should take the lead, so tech platforms do not dictate educational opportunities.

“We have to build classrooms first, not tech first,” said Mulchandani.

Rebecca Kantar, the head of education at Roblox – a video game platform that allows players to program games – added that as the metaverse is still emerging and being constructed, “we can be humble in our attempt to find the highest and best way to bring the metaverse” into the classroom for the best education for the future.

Anant Agarwal, a professor at MIT and chief open education officer for online learning platform edX, stated the technology of the metaverse has the potential to make “quality and deep education accessible to everybody everywhere.”

Not a replacement for real social experiences

Kathy Hirsh-Pasek, senior fellow of the global economy and development at the Center for Universal Education, said that while the metaverse brings potential to improve learning, it is not a complete replacement for the social experience a student has in the classroom.

“The metaverse can’t substitute for social interaction. It can supplement.”

Mulchandani noted the technology of the metaverse cannot replace the teacher, but rather can serve to solve challenges in the classroom.

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Digital Inclusion

FCC Chairwoman Jessica Rosenworcel Emphasizes 100 Percent Broadband Adoption

‘It’s about making sure wireless connections are available in 100 percent of rural America,’ said the chairwoman.

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Photo of Kelley Dunne, CEO of AmeriCrew, leading panel on workforce issues at the Rural Wireless Infrastructure Summit by Drew Clark

PARK CITY, Utah, June 28, 2022 – The Federal Communications Commission is making progress towards bringing “affordable, reliable, high-speed broadband to 100 percent of the country,” Chairwoman Jessica Rosenworcel said at the Rural Wireless Infrastructure Summit here on Tuesday.

Rosenworcel pointed to the $65 billion Infrastructure Investment and Jobs Act now being deployed across the country, with a particular focus on unconnected rural and tribal areas.

Although the Commerce Department’s National Telecommunications and Information Administration will take the lead with these funds, the FCC’s new broadband coverage maps will be important in implementing state digital equity plans.

In her remarks, Rosenworcel also discussed how the upcoming 2.5 GigaHertz spectrum auction will involve licensing spectrum primarily to rural areas.

At the July FCC open meeting, said Rosenworcel, the agency is scheduled to establish a new program to help enhance wireless competition. It is called the Enhanced Competition Incentive Program.

The program aims to build incentives for existing carriers to build opportunities for smaller carriers and tribal nations through leasing or partitioning spectrum. Existing carriers will be rewarded with longer license terms, extensions on build-out obligations, and more flexibility in construction requirements.

“It’s about making sure wireless connections are available in 100 percent of rural America,” she said.

She also indicated her commitment to work with Congress to fund the FCC’s “rip and replace” program to reimburse many rural operators’ transitions from Chinese-manufactured telecommunications equipment. She also touted the role that open radio access networks can plan in more secure telecommunications infrastructure.

In other news at the conference, FCC Commissioner Brendan Carr addressed the role of funding broadband operations in rural America, the challenges of workforce training, and ensuring that rural carriers have access to high-cost universal service support.

In a session moderated by AmeriCrew CEO Kelley Dunne, panelists from the U.S. Labor Department, the Wireless Infrastructure Association and Texas A&M Extension Education Services addressed the need to offer a vocational career path for individuals for whom a four-year degree may not be the right choice. AmeriCrew helps U.S. military veterans obtain careers in building fiber, wireless and electric vehicle charging infrastructure.

Broadband Breakfast Editor and Publisher Drew Clark contributed to this report.

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Broadband's Impact

Broadband Speeds Have Significant Impact on Economy, Research Director Says

From 2010 to 2020, a 10.9 percent growth in broadband penetration drove .04 percent increase in GDP, the study found.

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Photo of Alan Davidson of the NTIA, Caroline Kitchens of Shopify, Raul Katz of Columbia University (left to right)

WASHINGTON, June 28, 2022 – Broadband and higher speeds have made significant contributions to economic growth over the last decade, according to a study discussed at a Network On conference Tuesday.

Raul Katz, director of business strategy research at Columbia University, conducted his research to determine where the United States economy would be if broadband had not evolved since 2010. He developed four models to explain the economic contribution of broadband, and all found support to suggest that broadband development has contributed to substantial economic growth.

The long-run economic growth model showed that between 2010 and 2020, a 10.9 percent growth in broadband penetration drove a .04 percent increase in gross domestic product – the measure of the value of goods and services produced in the nation. States with higher speed broadband had an economic impact of an additional 11.5 percent.

“States with higher speeds of broadband have a higher economic effect,” said Katz. “Not only is there penetration as a driver, but there’s also… return to speed. At faster speeds, the economy tends to be more efficient.”

The study found that if broadband adoption and speed had remained unchanged since 2010, the 2020 GDP would have been 6.27 percent lower, said Katz.

Caroline Kitchens, a representative for ecommerce platform Shopify, said Tuesday that there’s been great growth in the ecommerce business, which relies entirely on a broadband connection. “Worldwide, Shopify merchants create 3.5 million jobs and have an economic impact of more than $307 billion. It goes without saying that none of this is possible without broadband access.”

“We have really seen firsthand how broadband access promotes entrepreneurship,” said Kitchens, indicating that this has promoted a growing economy in over 100 countries.

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