"US Ignite" Executive Order Doesn't Go Far Enough

The headlines are misleading.  Last week's Executive Order from President Obama is aimed at improving the United States' broadband, but it actually does very little for improving broadband penetration in rural areas.  It does some good things, though:

1. It makes it easier for companies to build out broadband infrastructure on Federally owned property including Federal land, buildings, and roadways.  This should lower the cost and decrease the time for companies to expand their networks in these areas, which is great, but only if the broadband companies actually choose to expand their networks in these areas.  As it is now, what incentive do they have to expand?  More on that later.

2. It creates partnerships with companies and organizations to develop "a new wave of services that take advantage of state-of-the-art, programmable broadband networks running up to 100 times faster than today’s Internet," which it is calling "US Ignite."  Here's a comprehensive list of projects that are already in the works by companies like Comcast and organizations like Mozilla (pdf).  New technologies and tools are always welcome as they inevitably increase the quality of the lives they touch, but why aren't we focuses on expanding availability in the present?

So, as I stated before, this Executive Order does not go far enough to solve the real broadband crisis facing our nation.  In my last blog post, I pointed out that access to broadband Internet is considerably lower for people in rural areas, people of low income, and people of minority groups.

So what can be done to address these inequities?  In my opinion, the best way to bring broadband into rural areas and to people of low income is to increase competition in the broadband space.

Because of the system that developed in the early days of building infrastructure for cable and telecommunications, many places in America have very few options when it comes to broadband Internet (many have a choice between one cable, one DSL, or maybe a satellite provider).  This lack of competition causes problems because there is no incentive for those companies to improve or expand their services.  This lack of competition hurts in three major areas:

1. Penetration to rural areas.  If a company's one or two competitors isn't offering services in those areas, what incentive do they have to spend large amounts of money to build out the infrastructure?  Increasing the number of competitors would increase the likelihood that one of them would want to expand, enticing the others to follow suit.  It would also make it possible for those companies to work together to build out a shared infrastructure or infrastructure that could be rented/leased to competitors.

2. Price.  With the digital divide perhaps widest between people of high income and low income, it is not unreasonable to conclude that the prices of broadband contribute to its low adoption rate.  Increased competition will lower prices as companies vie for customers by offering them more affordable plans.

3. Speed and bandwidth limitations.  In my previous post, I used a baseline of 3 Mbps download speeds to justify "broadband."  While technically this does qualify as broadband, it is still not fast enough for many of today's feature rich-Internet uses.  With the push toward web apps and as more storage is moved to the cloud, Internet users will require greater and greater limits of speed and bandwidth.  Competition can help here, too.

Not convinced?  Other countries have much more competition in the broadband market than we do in the US.  Just click here to see what increased competition has done for prices and speed in the UK.

http://www.pcworld.com/article/167391/a_day_in_the_life_of_3g.html

Some readers will say, "Well what about mobile? 4G is spreading to more markets every day!"  And they would be right--4G is a growing resource.  What it is not, however, is a replacement for broadband Internet.  According to an FAQ, the "average AT&T High Speed Internet customer uses only about 21 GB per month," with some using over 150 GB per month.  Comparing that usage to mobile data plans from AT&T ($210/mo. for 21 GB) and Verizon ($190/mo. for 21 GB) shows that mobile data is priced out of the range of most of the people who would be using it as a broadband replacement (i.e., rural customers).  Couple that cost with the fact that mobile broadband is not as reliable as fixed broadband, and it is apparent the mobile is not a replacement.

The idea behind the Executive Order is great, but I think the White House is trying to ignite a fire before they split the wood.  Before we can take advantage of the "US Ignite" program, actual increases in broadband penetration are going to have to take place.  Those increases cannot be made until some serious changes are made in policy to require or encourage competition.

Let me know your thoughts and ideas in the comments!