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Digital Inclusion

Kate Forscey: Biden’s Broadband Plan Begs the Question, If We Build it, Will Consumers Really Come?

One of the biggest problems with getting broadband access to all Americans is not just deployment but adoption.

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Author of this Expert Opinion is Kate Forscey, founder of KRF Strategies LLC

One good thing came out of the pandemic: Politicians across America have finally recognized that Internet access in 2022 is not a luxury, it is a necessity.  And Congress stepped up to the plate and passed the bipartisan Infrastructure, Investment, and Job Act, dedicating more money to closing the digital divide than ever before.

The recipe for achieving ubiquitous broadband requires three things: deployment, affordability, and adoption. For the past couple of decades, however, the U.S. has taken a “Field of Dreams” approach that ignores the last element. Our government approach’s operating assumption is “if you build the network, consumers will use it.” The data show that simply isn’t the case.

One of the biggest problems with getting broadband access to all Americans is not just deployment but adoption of the technology. Household income, region, race, and even the pandemic all play intertwined roles.

study by NTCA in just the past year showed that broadband adoption in areas where it is available dips from 99% in the age range from 18-29 to 75% in older demographics. Lack of adoption is also linked to level of education, from 71% in less than high school education to 98% in college graduates. The fact remains that getting Americans connected hinges on a lack of digital literacy and awareness, which runs the gamut from not understanding the technology itself to not realizing the program is there in the first place.

So when the National Telecommunications and Information Administration released its rules for the Broadband, Equity, Access, and Deployment Program on May 13th, there was a bipartisan breath of relief that the ball is rolling.

The Biden Administration is following the same tired playbook in focusing on buildout

Unfortunately, a closer analysis suggests the Biden Administration is following the same, tired playbook by placing the primary focus on buildout. The BEAD Program makes $42.45 billion available for broadband via grants to the States. States must prioritize buildout in unserved areas before moving on to underserved areas (or at least show that they have a plan to get access to an unserved area). The discussion of “non-deployment activities” for spurring adoption is short and relatively vague, almost like an afterthought.

Here’s one problem: States are not homogenous in terms of unserved areas. States like Kansas and West Virginia have significant (largely rural) unserved areas, while states like Maryland, Connecticut, or Florida have few.  So NTIA’s focus on broadband deployment means that States with fewer unserved areas are likely to focus their spending on additional buildout in areas that are already served (i.e., overbuilding), which is inefficient and likely unnecessary. After all, why spend scarce dollars to build out more in areas that already have broadband? Such an approach ignores the adoption prong of a successful broadband plan.

We need to adjust how we think of our priorities. Instead of implementing a field-of-dreams broadband plan, policymakers should ask themselves, if broadband is laid using federal infrastructure funding, but no one elects to adopt it, what have we accomplished? Probably nothing.

States don’t need to follow the NTIA’s lead and focus exclusively on deployment

The good news for States with fewer unserved areas is that they don’t need to follow NTIA’s lead and focus exclusively on deployment. The rules allow them to use federal funds on adoption projects  once they bring affordable broadband to all unserved areas. Education, outreach, and digital literacy are paramount in furthering Congress’s bipartisan goals. States should give more priority to educating consumers via digital equity programs (e.g., digital literacy education, broadband sign-up assistance, and remote learning facilities) once they have reached the unserved.

It’s time for States to formalize programs to Get Out The Adoption. States should hire people to knock on doors and leave pamphlets that let low-income Americans, minority and Tribal Americans, and veterans know there is a subsidy program available to them, how to apply, what the services are, and how to get access (and plus–that’s job creation!).

States should provide pop-ups like knock-off Genius bars in neighborhoods with historically low adoption rates where people can go to get help with devices or troubleshoot their newly acquired access. States should teach new users how to practice good cyber-hygiene; show them how telehealth can make their lives easier. States should create programs to educate new users about things a lot of those of us who work online every day take for granted as obvious.

Any funding program designed to bridge the digital divide needs to account for deployment, affordability, and adoption. And it is a fundamental economic principle—the more people see the value proposition and the less intimidated they are in using the technology, the more likely they are to adopt the technology. This cannot be an “if you build it, they will come.” We need to make the case for why we’re doing all of this in the first place. If it’s really worth $42.45 billion, then let’s make it so.

Kate Forscey is a contributing fellow for the Digital Progress Institute and principal and founder of KRF Strategies LLC. She has served as senior technology policy advisor for Congresswoman Anna G. Eshoo and policy counsel at Public Knowledge. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

Broadband Breakfast is a decade-old news organization based in Washington that is building a community of interest around broadband policy and internet technology, with a particular focus on better broadband infrastructure, the politics of privacy and the regulation of social media. Learn more about Broadband Breakfast.

Digital Inclusion

Broadband is Affordable for Middle Class, NCTA Claims

According to analysis, the middle class spends on average $69 per month on internet service.

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Photo of Rick Cimerman, vice president of external and state affairs at NCTA

WASHINGTON, November 22, 2022 – Even as policymakers push initiatives to make broadband less expensive, primarily for low-income Americans, broadband is already generally affordable for the middle class, argued Rick Cimerman, vice president of external and state affairs at industry group NCTA, the internet and television association. 

Availability of broadband is not enough, many politicians and experts argue, if other barriers – e.g., price – prevent widespread adoption. Much focus has been directed toward boosting adoption among low-income Americans through subsidies like the Affordable Connectivity Program, but legally, middle-class adoption must also be considered. In its notice of funding opportunity for the $42.5-billion Broadband Equity, Access, and Deployment program, the National Telecommunications and Information Administration required each state to submit a “middle-class affordability plan.”

During a webinar held earlier this month, Cimerman, who works for an organization that represents cable operators, defined the middle class as those who earn $45,300–$76,200, basing these boundaries on U.S. Bureau of Labor statistics for 2020. And based on the text of an Federal Communications Commission action from 2016, he set the threshold of affordability for broadband service at two percent of monthly household income.

According to his analysis, the middle class, thus defined, spends on average $69 per month on internet service. $69 is about 1.8 percent of monthly income for those at the bottom of Cimerman’s middle class and about 1.1 percent of monthly income for those at the top. Both figures fall within the 2-percent standard, and Cimerman stated that lower earners tended to spend slightly less on internet than the $69-per-month average.

Citing US Telecom’s analysis of the FCC’s Urban Rate Survey, Cimerman presented data that show internet prices dropped substantially from 2015 to 2021 – decreasing about 23 percent, 26 percent, and 39 percent for “entry-level,” “most popular” and “highest-speed” residential plans, respectively. And despite recent price hikes on products such as gas, food, and vehicles, Cimerman said, broadband prices had shrunk 0.1 percent year-over-year as of September 2022.

Widespread adoption is important from a financial as well as an equity perspective, experts say. Speaking at the AnchorNets 2022 conference, Matt Kalmus, managing director and partner at Boston Consulting Group, argued that providers rely on high subscription rates to generate badly needed network revenues.

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Digital Inclusion

FCC Advisory Committee Approves Strategies to Advance Digital Equity

In 2021, the FCC charged the council in its mission to prevent digital discrimination.

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Photo of Heather Gate, vice president of digital inclusion at Connected Nation and chair of the CEDC.

WASHINGTON, November 8, 2022 – The Federal Communication Commission’s Communications Equity and Diversity Council on Monday unanimously recommended strategies to minimize digital discrimination and advance digital equity, advocating stakeholder collaboration, the promotion of affordable broadband service, workforce diversity initiatives, state and local incentivization of partnerships with small minority and women-owned businesses, and more.

The new report’s three main sections lay out best practices to prevent discrimination by internet service providers, to ensure the equitable dispersal of funds from the Infrastructure Investment and Jobs Act, and to advance universal access for marginalized populations, respectively.

The IIJA allocated $65 billion to broadband funding. $42.45 billion from that pot went to the Broadband Equity, Access, and Deployment program, which will issue grants to the states based on relative needs. States will subsequently run their own sub-grant processes.

In 2021, the FCC charged the CEDC with assisting the agency in its mission to prevent discrimination based on race, color, religion, national origin, sex, or disability.

“This was a complex and critically important task for the CEDC, and I thank the members of the three working groups who worked so diligently to provide this expert guidance,” said FCC Chairwoman Jessica Rosenworcel. “Earlier this year the Commission adopted a notice of inquiry on preventing and eliminating digital discrimination, and I look forward to incorporating these findings into that effort.”

“I applaud the chairwoman for trusting the council to contribute to the commission’s efforts to gather information from diverse stakeholders across the country,” said Heather Gate, vice president of digital inclusion at Connected Nation and chair of the Communications Equity and Diversity Council.

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Digital Inclusion

Not All Affordable Connectivity Enrollees Are Using the Benefit: A Look into 30 Major Metro Areas

‘The percentage of households in major metro areas…using the program is smaller than the percentage of households enrolled.’

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Photo from USAC's affordableconnectivity.gov web site

Since the launch of the Affordable Connectivity Program last January, millions of households have benefitted from the $30 per month connection subsidy to help pay for their broadband bills. The program serves as a necessary bridge in a failed marketplace, dominated nationally by a small number of regional monopolies driven by shareholders to charge the highest price possible.

Along the way, ILSR and a host of other research and advocacy organizations have been digging into the American Connectivity Program data in order to better understand how the program has operated over the last year, and how we can work collectively to improve education and outreach efforts and make sure as many households as possible will benefit. From this work we created an ACP Dashboard to collect and visualize useful data to support the critical work of digital navigators, nonprofits, and local governments.

Explore the Affordable Connectivity Program here, and read more about why we created it.

Recognizing the Gap

In addition to tracking how much of the $15.5 billion fund ($1.3 billion was carried over from the Emergency Broadband Benefit and $14.2 billion was allocated for the ACP] is left and predicting when it’ll run out (April 2026 at current rates), keeping an eye on state- and zip-code level use and enrollment, and following what types of connections households are using the benefit to pay for, an important part of this work has been tracking data across major metropolitan areas across the country.

As we continue to analyze the data and refine our tools to support work at the local level, we have found that the percentage of households in major metro areas (and likely elsewhere) that are actually using the program is smaller than the percentage of households enrolled in the program.

While a community’s ACP enrollment rate has been understood as an indicator both of its overall need for financial support and the effectiveness of local outreach efforts to sign up eligible households to participate in the ACP, the rate of claimed subscribers reflects the real effect of the program on that community. Here, we take a look at what the gap between enrollment and subscription looks like across 30 major metropolitan areas.

Currently, the major metro areas with the highest ACP enrollment rates are Detroit (58 percent of eligible households enrolled), Cleveland (58 percent), Columbus (55 percent), Baltimore (53 percent), and Los Angeles (52 percent). Only Cleveland, Columbus, and Los Angeles, however, also appear among the top five areas for greatest percentage of eligible households using the benefit (Cleveland: 46 percent claimed subscribers, Columbus: 45 percent, Los Angeles: 41 percent).

When we dive further into the metro area data, we can get some sense of why some cities are succeeding in not only enrolling households, but making sure they are using the benefit. For instance, San Antonio is on the list of top-five metro areas for use, despite being ranked 11th for enrollment.

At present, only 16 percent of enrolled San Antonio residents are not using the benefit. Why? The city has dedicated resources to staffing field organizers, who go door to door in low-income zip codes and talk to residents about the program, offering information both in English and in Spanish. Similar efforts are underway in Los Angeles, where there is only a 12 point difference between enrolled households and those using the benefit. Los Angeles also has a coalition of groups doing their own funded and unfunded community outreach to raise awareness of the program.

On the other hand, the following areas have relatively high enrollment rates but show large discrepancies when looking at the number of claimed subscribers:

Washington, DC: 49 percent of eligible households are enrolled, but only 17 percent are using the benefit.

Atlanta: 49 percent of eligible households are enrolled, but only 17 percent are using the benefit.

Detroit: 51 percent of eligible households are enrolled, but only 19 percent are using the benefit.

Baltimore: 53 percent of eligible households are enrolled, but only 24 percent are using the benefit.

Philadelphia: 48 percent of eligible households are enrolled, but only 20 percent are using the benefit.

Cleveland and Detroit both have an enrollment rate of 58, but Cleveland has a significantly higher percentage of households using the benefit, likely the result of years of dedicated efforts by DigitalC and the Cleveland Foundation to close the digital divide. Portland has the greatest relative discrepancy between enrollees and households using the benefit, with more than two thirds of its enrolled households not using the credit.

Reflecting the Gap in Our Tools

To reflect the significance of these gaps, while an earlier version of our ACP Dashboard focused on enrollment rates, we’ve adjusted our methodology to use the Total Claimed Subscriber number to calculate current ACP usage rates and predict future funding levels. We believe using Total Claimed Subscribers reflects a more faithful representation of usage rates and the rate of funds being depleted. A future iteration of the dashboard may further investigate the discrepancy between percentage enrolled and percentage claimed.

Explaining (and overcoming) this gap between enrollment is important, but we need more data to do so. It’s possible that some ISPs are deciding after some period of time that it’s not worth the resources to administer it and participate. It could also result from families getting enrolled by their ISP but not understanding that the benefit is available to them, or not having the digital literacy skills to use it.

The gap could also result from the way that the FCC verifies households’ eligibility, and regularly de-enrolls households it (sometimes erroneously) decides no longer qualify. We need more granular data from the Universal Services Administrative Company and the Federal Communications Commission to better understand why this gap between enrolled and claimed users continues to grow.

The policy implications and our analysis of the efficacy and future of this program stand: if anything, these numbers reflect less success in education and outreach efforts nationwide.

Check out the ACP Dashboard for more information. Special thanks to Drew Garner for his insight and feedback on the USAC data.

Authored by Emma Gautier, this article originally appeared on the Institute for Local Self Reliance’s Municipal Broadband project on October 26, 2022, and is reprinted with permission.

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