Ok, I have to admit, I’m beginning to think that the government would have some grounds to give a few billion dollars to get broadband to the underserved in the US (see my previous post for more details). After all, even at our best, we are years behind other countries for their normal Internet services. Furthermore, at this point in time, the best way to resolve the need for broadband services is to move. So… there is an argument there that bringing broadband to a desolate rural community would boost its economy.
Sure, I’ll allow myself to see the point to it all, granted that these communities are actually being helped in the best way (here’s a previous post on how well the government is accomplishing this so far!). I’m keeping my ears and eyes open for news about the broadband stimilus plans. The FCC has had a few things to say. I want to see what other people are saying and where we’re going with this. This is all I’m getting:
They’re taking surveys! They are asking people if they want broadband. Well of course they do! If you walked up to 100 people who had to walk to work every day and asked them if they would prefer to drive a car to work, 95 percent of them would probably say yes! Who wouldn’t be a fan of the speed, comfort, and convenience of a car? Do we really need to pay people to go around asking these people this and writing us a pretty report about it?
Ask these same people if they want to buy a new car, and that they’ll only get to pick from two types of cars, and that it will be quite an increase on their monthly expenses, and that they will have to wait 5 years to get the car available in their area, they’d probably say, “Forget it! I’ll keep walking!”
These rural people are getting all excited and writing articles in their local papers about how wonderful this broadband access will be, but has anyone told them that they will have to pay a fortune for it and that it will take years for all of this to happen? Do they know that this 7.6 billion dollars from the government won’t even cover half of the necessary expenses? You won’t read that in the news!
Some of these stimulus funds will be used to take more surveys and create awareness about broadband (wow…). These digital communications companies are asking for grants to make maps of the greatest need for broadband (more surveys), and submit plans of actions, etc., etc., etc.
People. Isn’t there a better way? There’s enough surveying and reports and grant requests and more surveys to keep us busy for the next two years! And with every “act” and “program” the government establishes, that billion dollar budget is looking smaller and smaller. Don’t hold your breath people. Nobody’s going to be digging any holes, setting up any towers, or doing any other real work towards spreading broadband for a long time.
If you heard about the government stimulus package that plans to spend over 7 billion to get broadband in rural areas, don’t get too excited. This is the government we’re talking about afterall.
Here’s a few things we need to keep in mind.
- The current halt on afforable broadband service to rural areas is due to lack of interest for companies and for customers. Basically, it costs way too much money to get broadband way out to the boonies when not everyone wants to pay for it even if they did!
- Anytime the government hands out money, it has to jump so many hurdles and run through so much legislation that by the time they get around to it, we could probably have done it faster on our own with a big garage sale! Ok, ok… slight exaggeration. Anyway.
- There are a lot of big companies involved that will all be lobbying for their interests, and a lot of them are more concerned about their pockets than a few rural farmers waving their arms for a broadband bailout.
Here’s some of the things we dial-up users in the sticks have to look forward to:
So anyway… The FCC has been given until February to (get this!) define “broadband” so the government can properly dole out the funds. Yes February. As in next year. If you can’t guess, it’s going to take at least several years for this promised broadband to reach your rural little computer.
Why do we need to define broadband? Well because all these “high-speed” companies are giving customers such low-quality service that it’s hardly fast enough to be considered fast in today’s age. Check this out:
*Satellite services can drop your connection speed to that equivalent to dial-up as a penalty for using the service excessively.
*Wireless can become so overcrowded with users that it is actually slower and more unreliable than dial-up.
*Many ”low-cost” DSL plans have connection speeds that are no more than 10 times faster than dial-up (keep in mind that advertised speeds are not guaranteed actual speeds).
You might as well just stay with dial-up at that rate! Oh and get this!
*Our fastest connection speeds here in the U.S. is much slower than the normal connection speed in other countries. So much for being an advanced country!
So now the FCC is asking some of these Internet services providers to help them decide how fast broadband should be (or how else to determine what makes broadband what it is–long story), and phone companies like AT&T are trying their hardest to keep the standards low. They want broadband to be defined as being able to achieve basic tasks (like web page loading) and not even including video streaming and gaming capabilites!
Guess what? That, my friends, is dial-up. And we already have that. Yes, this is going to take a while. Looks like I’m going to keep going to the library to get videos… But I’m ok with that. I never had my hopes up from day one anyway.
In recent posts, I have been discussing my opinion of the stimulus money being designated to the spread of broadband to “underserved” rural areas. I live in said area and I’m not jumping up and down for joy. It seems to me that it’s going to be more work and money and time than the government can handle. And I’m not convinced that installing broadband should be the government’s priority.
Regardless, one aspect that I haven’t delved into as thoroughly is the economics of pushing broadband to rural areas. Supporters of this broadband initiative says the financial outcomes will be well worth the money the government is spending and the profits will be enormous.
I recently came across a blog post by Shane Greenstein, a Professor at Kellogg School of Management, Northwestern University. This post and many others Greenstein wrote in his blog, Virulent Word of Mouse, are based on his experience is a professional researcher and economist.
I had the opportunity of discussing these posts and his work further in an interview with Prof. Greenstein. His interest in the economics in relation to broadband began three years ago, during “a project to update statistics about the diffusion of broadband and dial-up,” Greenstein said. “There is not a lot of data measuring the economic impact of broadband, so that allows for the survival of a wide range of passionately held beliefs,” including those have made extravagant claims about the profits gained from pushing broadband to rural areas.
Over about 18 months, Greenstein collected data and wrote a research paper with the help of colleague Prof. Ryan McDevitt, The Broadband Bonus: Accounting for Broadband Internet’s Impact on U.S. GDP. The study was presented to various organizations, including the National Bureau of Economic Research. Several of his blog posts I read included facts based on the data shared in this paper. Clearly, this guy knows what he’s talking about!
The post I referenced above is not opposing the stimulus plan, but advocating reason among the lofty claims of a supposed ‘economic transformation’ that will take place from getting broadband to rural areas. Greenstein basically explained a realistic summary of the benefits (and disadvantages) of this broadband initiative. Those who make up the rural population who do not have any access to conventional broadband access are so few (about 5 percent of the U.S. population) that the economic impact will be small.
In addition to detailing the feasible profits gained directly and indirectly from increased Internet services, Greenstein mentioned other factors negatively effecting the success of this initiative. The lack of broadband adoption (just because its available doesn’t mean everyone will want it), the costs of equipment and work needed, and the loss that some local businesses (including newspapers and post offices) will experience from their customers shopping online to save money are a few of the losses that must be considered when calculating the profit that can be had from spreading broadband.
Greenstein has not opposed to the stimulus bill since was first announced. “We were in the midst of the worse downturn since the great depression,” he explains. “ In principle, there was nothing else for the administration to do except something like a stimulus bill.” Greenstein didn’t really seem concerned with taking sides, but is interest to see how the push for broadband will turn out.
You can read Greenstein’s posts and others he linked to if you are more interested. I found these posts to be easy to understand, yet informative and supportive of previous opinions I have given on my own blog. Let me know what you think!
In the past few posts, I’ve been talking about this idea of it being the government’s responsibility to pay for the cost of getting broadband access to “unserved and underserved” rural areas. The initial simplified look at this logic seems to make sense, but if you look at the truth behind the broadband stimulus argument, you will see that some over-generalizations have been made. Wrapping up, here is my conclusion, and a summary of the false assumptions that have been made in the creation of this idea.
False Assumption #1: Many people (especially rural residents) don’t have Internet access.
True Statement: Many people don’t have affordable broadband Internet services in their homes. But most of them can get Internet access in one way or another. There are thousands of rural homes who use dial-up because that’s the most affordable option to them, and certain types of broadband is not available to them. Sure, dial-up has limited capabilities, but you can still read news and other educational resources, send and receive emails, and load the majority of webpages.
False Assumption #2: Since the Internet provides so many educational and business-related resources and outlets, providing broadband to more homes would increase education and business.
True Statement: That’s a nice thought, and maybe in a small degree that would be true. But business and education are not the primary uses for the Internet. Most people use the Internet for fun and personal interests. People with broadband have even more fun. With live audio/video streaming at a flawless rate, you can watch movies, play games, listen to the radio, chat live using webcams with friends and random strangers, and the list goes on.
Top 10 most popular websites—see what the majority of online users are doing.
Top 25 uses for the Internet—see this list for more ways to waste time on the Internet.
When you have Internet access, you use it. When you have faster Internet access, you use it more—but don’t expect everyone to start being any more productive, smarter, or richer. How is this a pressing issue for the government (to the tune of over 7 billion dollars), considering what the majority of us are doing online?
False Assumption #3:The increasing use of the Internet for education and business justifies the government to grant billions of dollars to help make it available to everyone.
True Statement: Lets assume that everyone did use the Internet productivity, and that making it more available would boost the economy. Is it really the government’s duty to expand our educational and business resources? Let’s not pretend that education and business aren’t already in place! We are a capitalistic society, we’re supposed to do that for ourselves! Even if this stimulus plan did a world of good—and maybe ten years from now we’ll see that benefit—the government does not have a responsibility to pay for our Internet services.
Where is the government getting all this money anyway? Considering we are deeply (that’s an understatement!) in debt to multiple countries and our accumulated government debt balance grows by gigantic leaps and bounds, I’m afraid to ask!
This “lack of broadband” issue does not present some terrible crisis—people are just tired of dial-up or don’t want to spend a bunch of money for satellite. We aren’t dying or being threatened here! We are still farming, educating, conducting business, and communicating—even if some of us are still using books or have to go to the library to check our email. We’ll find ways to connect to the Internet and develop new ways of spreading broadband to rural areas on our own. Please. Leave the government out of this!
In my last post, I discussed an article that proposed that the government has a duty to provide broadband Internet to rural areas. Here are the reasons leading up to this conclusion—but this time we’re looking at the whole picture. This information is based on my knowledge as a technician for an Internet provider and my extensive research on the subject.
More and more people are using the Internet. Yes, this is very true. In fact, the U.S. is nearly saturated with Internet services and one of the leading countries with broadband access. The growth of Internet usage just within the last five years is staggering, with many people signing up for more Internet access daily.
The Internet is becoming a larger venue for business and education. The majority of businesses have websites, and many of them take and ship orders online. Online college classes are still being taken with people getting degrees later in life. Private education for grade-school ages are offering online courses. The Internet provides a vast, no, gargantuan collection of educational information that was once contained only in books and libraries. Read my post about “necessities” that have been replaced by the Internet and technology. The Internet has, in a very short time-span, transformed our language, social habits, culture, and communication. Its actually kind of overwhelming to think about. And the advancements and changes not slowing down one bit!
People who do not have access to the Internet lack the ability to gain from these advancements. Quite true! It would be foolish to deny this. But how many people truly have NO access to the Internet? There are MANY ways to access the Internet:
Library/Coffee shops/other Public areas
Cell phones/any area with a wireless hotspot
ANY home/building with a land line phone (dial-up)
ANY home/building with a clear view of the Southern sky (satellite)
Granted, there are some people who have many more options than others. I am not denying that there are “underserved” U.S. residents. I am saying that it would be foolish to assume that just because many people can’t get common types of broadband in their home doesn’t mean that a) they have no access to the Internet elsewhere, or that b) they don’t have any form of Internet access in their home, or that c) people without Internet access in their homes must have it in their homes in order to become educated and conduct business.
Most people do have some form of Internet access even if it isn’t broadband or isn’t provided directly to their home. Those that have no access any type of Internet services whatsoever are a very small percentage of U.S. residents. The number of businesses in this situation is even smaller.
Many Internet and phone companies have essentially given up on being able to afford providing broadband to certain areas. There are some places, like my house, where they don’t bother to install cable or DSL lines for obvious reasons.
The cost of installing the equipment necessary to provide these services to scattered rural homes would be enormous.
The income from rural customers willing to order the service would never pay the costs of installation.
Even if they did bother to run all these lines, etc., we are too far away from the source of the digital provider for a strong enough signal to reach our house.
These companies are not being petty losers. It’s just really not within reason. There are many more complications that would take more time to explain (and perhaps I will post about it later). The stimulus money will help, but it’s not going to solve our problems alone. We’re going to need even more money–and probably several years if we really want to provide affordable broadband to all the rural and low-income areas. There’s a long road ahead of this ambitious venture.
In the next few days I’d like to wrap up this discussion. Stay tuned! And feel free to comment! I’d love to hear from you!
I recently read an article and was simply appalled. Unfortunately, this is not some loony outspoken voice, but a common conclusion of many recent articles I’ve read. Here is, basically, the premise of this writer’s (and other’s) logic.
More and more people are using Internet services. True!
The Internet is becoming a larger venue for business and education. True again… among other things!
People who do not have access to the Internet lack the ability to gain from these advancements. Well, of course!
Many internet and phone companies have essentially given up on being able to afford providing broadband to certain areas. Very true! This includes my area.
THEREFORE… It is the government’s duty to provide broadband Internet to the unserved and underserved areas of the U.S. What?!
The duty of government is to protect the people. I don’t know why that’s so hard to grasp. Why should the government do any more than that? We are a free people. Free to create our own homes, jobs, and families around our preferences, choices, and beliefs. We are free to decide how to invest (or waste) or own money. The foundation of this nation was based on that idea. Freedom, and capitalism.
Sure, there are plenty of scenarios where people do not benefit from a capitalistic society. We all know the stories of the filthy rich and the dirt poor all because of capitalism (although that is not exactly true—it’s because of injustice and poor decisions). We live in a flawed world—we can’t escape flaws. Every other type of government also has flaws and disadvantages—perhaps more than ours.
But back to the duty of government. There are three essential ways that the government can protect the people:
Protect them from threats against them from the outside.
Create and enforce laws that create a safe and orderly environment from the inside.
Collect taxes from the people to fund these operations.
The government has since added providing education and supporting the disabled and unemployed to their list of duties. Regardless, since when is it the goverment’s duty to provide broadband Internet?
America has forgotten their rights and freedoms and chosen a route of dependency and self-insufficiency. We are willing to give up freedom so we have less responsibility. We want to be taken care of and have things done for us. We don’t want to work. We don’t want to make wise choices so we have good enough credit to buy our own houses and cars. What if we educated our own children or fed and clothed our own poor? What if we were willing to sweat and smell to pay our own bills? The government would have no choice but to do the job they were originally meant to do—protect us.
This article that I read had many truths that are clearly agreed upon by the majority of us. I am not saying that providing broadband to “unserved and underserved rural areas” is a bad thing or that I am against the spread of broadband. I am simply proposing that our country is a little too dependent on being bailed out by the government. Unfortunately, the more things we leave up to the goverment to run, the less freedoms we have. Is that what we really want?