Broadband and internet access is an increasingly important. While broadband may seem less important than other infrastructure, it has enormous implications. Rather than causing overt damage and harm like potholes or excavation damage do, lack of access to broadband hinders economic growth, access to information, and participation in additional services like community involvement, education, healthcare, and more.
Lack of meaningful access to broadband has two main implications: poorer social outcomes and unrealized gains in economic potential. The first can actually represent harm, while the second is an opportunity cost.
According to the Federal Communications Commission (FCC), 18 million Americans live without access to fixed broadband service at threshold speeds as of 2020. Other studies, such as the one conducted by BroadBandNow Research, suggest that the number of Americans without meaningful internet access is closer to 43 million.
This lack of access has profound effects for job creation programs, healthcare, and the wider economic success of the region. The impacts can range from an inability to shop and compare medical services or schedule needed appointments, to lack of connection with a local community or social programs.
Broadband access also greatly impacts education. With school becoming increasingly technology-dependent, it is crucial for students to have internet access at home, an issue that has been exacerbated by the Covid-19 pandemic. An estimated 17 percent of students are unable to complete certain assignments because they lack internet access at home.
Additionally, a reported majority of principals say that they have students who lack internet service. For example, in rural Maine, Principal George Reuter of Buckfield Junior-Senior High School had to hand out 25 cell phone hot spots for students and staff without Internet access to be able to continue to complete assignments. Maine struggles with broadband access for its vast interior, contributing to a massive drain of young professionals that leave the state every year. This same phenomena can be found in rural areas and remote regions across the South, Midwest, Southwest, and Western United States. By limiting the educational opportunities available to students and access to lesson plans, additional training, and learning materials for teachers, inadequate broadband access increases the future costs to train a twenty-first century workforce.
The costs begin to add up from a social, health, and educational standpoint, but insufficient broadband access also impacts the economy. Only a 10 percent increase in broadband penetration in the U.S. in 2016 would have led to a projected 806,000 additional jobs in 2019. Broader access to the Internet and faster speeds are also correlated with direct levels of investment to specific areas and lower unemployment rates.
Without internet access, businesses have a hard time adapting and contributing to the market. This can also hinder productivity and overall efficiency. From market research to connecting with suppliers to shipping and logistics, reliable high-speed internet has become a necessity for even small family-owned businesses. To switch from a no internet access or even basic dial-up to high-speed internet access can mean connecting with new customers, improving the efficiency of services, accessing human resources or tax professionals, and competing with other businesses in a way that drives innovation up and costs down.
Estimates put the economic growth potential for just a 10 percent increase in broadband at 1.21 percent in GDP for developed countries like the U.S. Having internet access ensures a digital competence and literacy and also helps businesses to appeal to the masses through various forms of online marketing. Every dollar invested into broadband may generate as high as four dollars for the economy.
Additionally, individuals who lack access in their home have less of an opportunity to contribute to the economy through the online marketplace. The state stands to profit from this much needed investment in broadband as well, with state income and sales taxes bringing in larger shares of money for a state’s budget.
Lack of internet access disproportionately impacts individuals in tribal communities as well as in rural areas. Additionally, though they may have access to the internet, Americans in urban areas often lack affordable and reliable home internet options. A higher percentage of white families use broadband than do black or Latino families is urban areas as well.
It is time for every American to have access to the internet, leaving them the choice to utilize it rather than precluding them by lack of options of prohibitive costs. The Covid-19 pandemic made it abundantly clear that the need for universal broadband is not only an internet access issue, but also an education, social, health, and economic issue as well. Reaching near 100 percent broadband coverage will help bridge the gap of the digital divide and promoting transparency and fair competition will help affordability.
Several innovative solutions can be utilized to solve the lack of broadband access. Not all of them require federal action or throwing money at the problem. In fact, incentivizing private action and assisting with public support from the lowest levels up may prove most effective.
Telecommunications firms must have a role in closing the broadband access gap. These are the entities actually creating and deploying the infrastructure and providing internet service. Charter Communications announced a $5 billion, 24-state wide project to bring Internet access to rural areas; creating 2,000 additional jobs in the process. Comcast’s Internet Essentials program offers low-income households Internet service hookups, as well as computers and other digital devices at extremely low rates as a part of its $650 million investments in digital literacy training and awareness programs, all with no federal funding.
Local funding initiatives have some success at identifying gaps in broadband infrastructure, which means they are best suited for helping allocate assistance, however the main source of public funds for broadband expansion comes from the Federal Communications Commission. The FCC works off of census information, meaning that information gaps from census data will mean some areas are unaccounted for in the $20.4 billion in funding through the recently approved Rural Digital Opportunity fund.
Finally, public-private partnerships in several states have brought together tech companies, regulators, and universities to outline plans for broadband access, including utilizing private land to carry broadband infrastructure with landowner’s approval and setting statewide standards for broadband speeds. For example, the state of Arizona has leveraged its vast interstate highway system as an avenue for laying proper broadband infrastructure in order to reach rural and tribal areas without large-scale construction being needed. In New Mexico, the state has partnered with ExxonMobil to establish a $5 million fiberoptic network across a 107-mile route to bring thousands of business online. In the city of Detroit, Michigan, city officials have formulated a three-pronged plan to increase digital literacy, provide Internet access, and supply devices through the establishment of WiFi networks throughout the city.
By utilizing a combination of industry innovation, competition, government data, and strategic public funding, broadband access can be targeted towards the areas that need it most, while ensuring efficient utilization of government investments. In order to ensure broadband access is expanded with maximum reach, utilizing local officials knowledge as well as industry expertise can ensure that more Americans are brought onto the digital grid.
Written by John Cassibry, Media Coordinator and Roy Mathews, Public Policy Associate
The Alliance for Innovation and Infrastructure (Aii) is an independent, national research and educational organization. An innovative think tank, Aii explores the intersection of economics, law, and public policy in the areas of climate, damage prevention, energy, infrastructure, innovation, technology, and transportation.