President Joe Biden pitched his $1.9 trillion infrastructure plan, which includes proposals to improve mass-transit and repair roads and highways to expanding broadband, in a recent appearance at his beloved Amtrak’s 30th Street Station.
But the program’s crucial commitment to closing the digital divide must not get derailed by doubling down on failed policies from the past, such as prioritizing government-run broadband networks on the discredited assumption that they provide better service at lower prices to disadvantaged communities.
Some progressives still dogmatically evangelize the supposedly transformational power of government-operated broadband networks. But their blind faith runs afoul of the facts.
In reality, government-operated providers have a long track record of financial failures that leave taxpayers on the hook, and research indicates they tend to charge consumers as much or even more than private competitors, while having little to no impact improving broadband adoption rates in low-income communities.
Refuting the argument for government networks, there’s no evidence that they reduce broadband prices in the communities where they operate. Instead, as the many have pointed out, they charge about the same amounts as privately-owned networks.
And when University of Pennsylvania professors Christopher Yoo and Timothy Pffeninger dug into the financial stability of twenty municipal broadband projects across the country, they found that over half were losing money year to year, and only two of the networks were on track to earn enough to cover the costs of infrastructure deployment over 30 to 40 years of its useful life..
From Provo, Utah to Groton, Connecticut, the landscape is littered with cautionary tales of towns that spent big to build money-losing municipal broadband networks that eventually had to be sold off for pennies on the dollar.
Here in Philadelphia, we’ve seen for ourselves how politicians’ pet projects can generate hype and headlines but fail to deliver on promised high-speed broadband for low-income families.
The “Wireless Philadelphia” project was supposed to turn our city into a giant hotspot, providing low-cost internet service to the neediest neighborhoods. But the city’s partner on the project, Earthlink, bailed before even completing the network, turning it over to another company which eventually went bankrupt. Philadelphia’s city government eventually bought back the network to help conduct video surveillance in targeted public spaces.
When much-ballyhooed boondoggles like Wireless Philadelphia go belly-up, they soak up public resources – and lawmakers’ limited focus – becoming burdens, not benefits, for low-income people and marginalized communities.
The lesson: Rather than rely on risky experiments that take years to complete, the federal government should take simple, straightforward approaches to closing the digital divide.
To close rural infrastructure gaps, a bipartisan framework from U.S. Sens. Joe Manchin, D-W.Va., and John Cornyn, R-Texas, would carefully target federal dollars to those areas still lacking high-speed networks – letting all technologies and providers compete instead of unwisely favoring government-owned boondoggles. And to close broadband adoption gaps, the simplest and most effective solution is to directly help low-income families’ buy broadband service.
The ultimate goal isn’t to put more wiring in the ground for its own sake, but to bring affordable broadband to every family through the fastest, most efficient means possible.
As the telecommunications policy expert John Horrigan’s new research details, we won’t close the digital divide just by throwing more money at local governments to build out additional networks in areas that already have high-speed broadband available.
At best, increased competition has only a marginal impact on broadband adoption – and it takes several years of planning and construction to achieve even those modest gains.
Instead, the faster and more effective approach to boosting broadband adoption is to directly subsidize low-income families to get online.
As part of the nation’s response to the Covid-19 crisis, the Emergency Broadband Benefit program provides up to $50-a-month to help hard-pressed families subscribe. Now we need a Permanent Broadband Benefit along those lines, as many of the nation’s leading civil rights groups have urged.
We already know that offering substantial discounts to low-income families can begin to bridge the digital divide. Private sector low-cost initiatives such as Comcast’s Internet Essentials have connected 14 million low-income Americans for $10-a-month or less.
But, with our city’s poverty rate of 23.3 percent before the pandemic, even $10 a month can be a lot for Philadelphia families living meal to meal.
A permanent broadband benefit will build on the progress that the private sector, our city government and community groups have made and will get more low-income families online.
Philadelphians and all Americans have seen too much time and money wasted on projects that sound good but fail to deliver.
As we move forward with Biden’s plan to “Build Back Better,” from highways to high-speed broadband, let’s do it right – and build on what works.