Broadband Internet – If you build it and GIVE IT AWAY, will they come?

Last summer I had the chance to help different companies apply for grants under the first round of the Broadband Stimulus program. One of my clients was The Knight Center of Digital Excellence (http://www.knightfoundation.org/home/), they contracted with me to map demographic data in various cities where they were applying for funding under the adoption portion of the stimulus program. My job was to create static map images by census block group showing data points such as age, sex, education level, income and internet adoption rates. The raw data covered various cities for the project. One of these was Philadelphia, a city of which I have an interesting level of experience. I worked for EarthLink as a Chief Wireless Engineer for their Municipal Wi-Fi projects and Philadelphia was my responsibility. I had overall charge for the wireless design and implementation, supervising the junior engineers and approving their work. This gave me a unique perspective on the data that I was mapping for the Knight Center. As I created these maps, I noticed something strange when looking at the levels of broadband adoption. The Knight Center wanted me to clearly show the areas of the city that had adoption rates below 40% of the households. As I placed the raw data in map form, a very alarming pattern showed up. The less than 40% rate census block groups were in exactly the same places as the live EarthLink network! I am but one of a handful of people who could have ever noticed this. The odds of someone mapping an adoption rate for this city who would have also known the actual deployment area of the EarthLink live network are very slim.

Broadband Adoption Rate for Philadelphia

Philadelphia Broadband Adoption Rates by Census Block Group

If you examine the areas of red and orange on the map they correlate almost exactly to the areas of the city that EarthLink had the actual live Wi-Fi network. What makes this even more interesting is that when EarthLink sold the system to NAC (Network Acquisition Company) in June of 2008, the network was left wide open with no restrictions for access. In many locations you could pull a 6 meg connection over Wi-Fi. I had spoken to NAC after they pruchased the system as they were discussing the option of hiring me as a consultant. They admitted they had not done anything to secure the network from free use nor limit the connectivity speeds. So the very next year, the reported broadband adoption rate in these areas where there was free Wi-Fi high speed internet access, was still below 40%!

This raises a couple of key questions. The first one I considered, was to how the data gathering was conducted. Did they survey people and ask them if they subscribed (meaning paid) to any high speed internet service? If that was indeed the question, I can see how this might show low adoption. These people did not have to subscribe to high speed internet service because they could get it for free. The second question to consider is, if you have high speed internet available FOR FREE, without the need for any special equipment, why aren’t more people on the internet?

Now these areas that did get built by EarthLink were high on the priority list for Wireless Philadelphia. They were identified early on as low areas of broadband internet adoption. So after almost 2 years of access to free internet service, why is the adoption rate still so low? One must consider the possibility that it is not lack of access to the technology, but some other factor(s). Obviously cost of the service was not a issue, it was free. These neighborhoods are not out in rural America where you cannot get high speed internet (outside of satellite) no matter what. They have access to cable internet and DSL along with cellular data networks. There are even other Wireless Internet Service Providers (WISP’s) offering service in these same neighborhoods. We had to deal with them and EarthLink went to Federal Court with one over interference issues. There may very well be other issues to adoption. Do these people just not want to be on line? Can they not afford a computer? Are they of the age where they are intimidated by computers and therefore won’t try to use them? Is it an education or literacy related issue? Is there no clear cut answer?

These are key questions that need to be answered. The stimulus program laid out a large amount of money for projects that were specifically for adoption in cities and areas that already had access to broadband services. Many people are still guessing at these issues and will use those monies as an experiment to find out why. Personally I think they should have looked at this specific situation first before going after all these large scale adoption projects in large cities. Philadelphia offers a good place to start looking as you could not get a better experiment to see what would happen. Heck they gave it away and still we have low adoption. Lets put the efforts in to looking at this area first. Once the answers are known, money can be better spent on adoption.

These issues and answers are very important especially as the FCC is considering changing the rules for the Universal Service Fund (USF). They are working on opening up the fund for broadband internet services and part of that is being considered for adoption. If we don’t understand why there are low adoption rates in areas with access, then why are we inviting rule changes that don’t offer proper solutions and will just become more waste for those funds?

My next blog – “Where should USF be allocated when considering broadband service?” I have hard and fast data that can determine this today. I know the threshold private industry will support without subsidies based on household densities and can break it down state by state.

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About Brian Webster Consulting - Wirelessmapping.com

Wireless Engineer and Geographic Information System Consultant with over 20 years wireless industry experience. Specialties include Radio Frequency (RF) System design, project management and custom mapping and data mining services.
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4 Responses to Broadband Internet – If you build it and GIVE IT AWAY, will they come?

  1. Interesting observations, Brian, and a nice map! It’s been many years since I’ve lived in Philly but it seems to me the blue (high BB adoption) areas correlate with wealthier neighborhoods. It’s pretty well understood, from Pew surveys and from the recent survey by the Dept of Commerce & the NTIA, that broadband adoption is correlated with income, with education, with race (Asians #1, white #2, black #3 and hispanic #4) and inversely with age.

    The top reasons people state for not adopting BB are:
    – don’t feel they need it 38%
    – too expensive 26%
    – don’t have computer fast enough to use BB 18%

    Based on (admittedly limited) personal experiences at two community centers in housing projects in Boston, they age differences are noticeable. Younger people have found value in the Internet, while many older people have not.

    Finally, my (sadly) cynical answer to your question “why are we inviting rule changes that don’t offer proper solutions and will just become more waste for those funds?” is that broadband politics is about vested interests fighting over federal dollars, nothing more.

    • Brough,
      I would have to agree with your cynical answer and that was kind of the point of my posting. I wanted people to realize that we may not have properly identified a perceived problem therefore we are throwing money at programs that do not have a properly defined outcome. Like it or not our government needs to make some hard decisions on what is more important to spend the money on. We can’t continue in this pattern of deficit spending when the economy is in the crapper. Some things are just going to have to wait until it gets better. My personal opinion is to spend the funds to get some sort of broadband service to those areas that have none first. We already know that when you have broadband available the adoption rate is over 60%, so there is an almost guarantee of a good size customer base for newly built systems. Now it won’t be number of customers like you get in densely populated areas but still you will have that percentage of customers to count on. There is a pent up demand in the areas without any broadband services. It is also known that a certain percentage of those customers are going to be businesses which will help contribute to the economy in more ways than just average consumers do.

      To me its a matter of spending the money where will it will have the most impact first. If there are some sort of funds available after that, we can chase programs that work on the adoption problem, but spending money on programs to basically drag people kicking and screaming to the internet seems like a poor payback for the taxpayer dollar when there are other areas of the country begging for some sort of broadband option besides satellite. I just don’t see these people who have access to broadband and still not using it, as being the population segment that can pull this economy back up on it’s feet.

  2. Jay Clark says:

    Hi Brian,

    Glad to see you are still out and about.

    I have a couple of thoughts about broadband.

    First let me say that I have been involved in providing BB access for a while now, back in the early 90’s I launched DSP which was the third ISP providing access in the SF Bay area. I have also personally been on line since the 70’s when getting on-line started with a soldering iron.

    One of my observations over the years was that in order to get folks on line you had to engage them at a very basic level, my rule of thumb was if you can get them by the gonad’s their hearts and minds will follow.

    Translated this means that folks have a will to ignorance but if you can provide some service that they simply MUST have, they will put the time into learning how to do whatever it is they must learn in order to get on line.

    Second observation is that things have changed from the days of 1200 baud modems, it is way more simple now, so you really do not have to make that much effort to get on line. But I have also observed that while in the early days folks tended to be willing to contribute to whatever community they were involved with by actively participating in that community. In 2010 this does not seem to be the case, now it seems that folks simply want to be entertained, a large part of the current on-line population seems to view the “net” like a different form of television, they tune in from time to time, but don’t really see themselves as member of any particular community.

    Finally and I think this is the most significant observation, I think you have to re-define what “on-line” means.

    Recently three, teenage, grand daughters came to visit. At all times during their visit at least one of them was busy “texting” on the cell phones their dad had gotten them, most times two of them would be texting. If I were to send one of them a text message right now, I would probably get a response within ten minutes.

    In more general terms, the needs that caused folks to go on line 20 years ago are now being met by technologies that are not considered to be “On-Line”.

    It seems amusing in a way, the Corporate Horde is charging down the highway to the future that seemed to exist 10 or 15 years ago, while new technologies are evolving that will make all their efforts unwanted, and unused.

    jayr

    • Jay,
      I could not agree with you more. One needs to equate broadband with the mindset of how electricity was viewed in the early 1900’s. Back then the people who did not want to adopt saw it as they didn’t need electric lights in the house. People only viewed electricity as being used for lighting only. Look at everything that has evolved from having electricity available today! The world would come to a halt without it now. Things like appliances, motors for the manufacturing industries and of course the computer revolution. None of those things were conceivable by the masses back when electricity was first introduced to society. We should think of broadband in the same way. Keep our minds open to the unthinkable.

      You mention the killer applications to compel people to want to learn how to get on line. I think one of those already happened. The digital camera was probably a bigger influence for many of the baby boomers and retirees to get on line. Being able to see photos of family and grandchildren instantly is a very compelling reason to get on line for many. The increased file sizes for pictures taken with megapixel cameras rendered dial-up painful and then useless after a while. You can see hundreds of pictures of the little ones faster and so much cheaper than print media now. What type of application is it going to take to get those last holdouts on line I don’t know. If I had to guess it would be something that doesn’t resemble a computer. Maybe these connected TV’s will bring more on board, but if the adoption problem in income based, I don’t imagine big expensive flat screen TV’s are going to be that ticket either. Some sort of limited appliance that is simpler than an IPod will need to be it. Throwing taxpayer funds at the problem, when it’s money we don’t have is not the answer though. Leave it to the inventors and innovators just like capitalism is supposed to do…….

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