Analysis: Internet Access — An Incomplete Promise

The U.S. has failed to deliver on universal high-speed, wired Internet service. The consequences for America's disconnected are a litany of troubles: economic decline population loss, less access to education, and poorer quality medical care. History is likely to judge us harshly.

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EDITOR’S NOTE: This article is excerpted from a the report “Service Unavailable: America’s Telecommunications Crisis.”

A prime example of the highly detailed irregularity of landline Internet infrastructure is the case of Jesse Walser, who lives about 20 miles outside of Syracuse, New York, in the town of Pompey. With Time Warner Cable lines about a third of a mile down the road from his house, Walser nevertheless was told by the company that he’d have to pay more than $20,000 to connect his home its network.

Walser and many other Americans are victims of arbitrary redlining by incumbent telephone and cable companies. It’s difficult to make a credible argument that living a third of a mile from existing infrastructure puts a customer in the middle of nowhere, making it too expensive to extend service. Walser’s experience of living close to existing telecommunications infrastructure but not being able to get service is not unique. This situation has existed unchanged throughout much of the United States over the past decade and isn’t likely to change anytime soon without an aggressive plan to address this infrastructure deficit.

With their homes and small businesses lacking access to robust fiber Internet service, many American small business operators try to get by with mobile wireless service not intended to support businesses. Larry Korte is an example, trying to run his consulting business in Churchville, Virginia, on 4G cellular service. But since the service is essentially metered Internet, where users pay overage charges for exceeding bandwidth limits, Korte finds the service expensive and a poor value. “I go to the [cell phone provider] and say, ‘Well, we need 300 gigabytes a month. That would probably do it.’” Korte said. “They laugh at it, and tell me to go to the cable company.” But like many residents in Augusta County, Virginia, Korte’s home is unserved for cable.

Tennessee State Senator Todd Gardenhire (R-Chattanooga) wants to get better Internet access to about 800 homes in his district. He notes that Charter, Comcast, and AT&T told him that “it’s not profitable” to serve homes in that district, which covers parts of Hamilton and Bradley counties in southeast Tennessee. Some premises in southern Bradley County are less than a mile from Chattanooga’s municipal fiber service, leaving them with dial-up service and a slow connection speed. That leaves nursery operator Joyce Coltrin, like many unserved Americans, reliant on her smartphone for Internet access. “It’s very hard to use an iPhone for business,” said Coltrin, who heads a group of 160 households who call themselves “citizens striving to be part of the 21st century.”

Joanne Hovis, CEO of the national Coalition for Local Internet Choice, notes that mobile wireless Internet service provides just a fraction of what fiber can deliver with respect to speed, reliability, and capacity. “Because of data caps and usage-based pricing, it’s also very, very expensive for anyone who uses a lot of bandwidth, such as families who home-school and therefore require lots of online video,” Hovis complains. She adds that those who argue that people don’t need fiber infrastructure because they have DSL or wireless service “is like saying that the nation doesn’t need the Interstate highway system because we have the Santa Fe Trail.”

Regions Suffer Disparate Internet Infrastructure

There are many communities in Virginia—largely in the central and southwest regions—where less than 55 percent of households have Internet connections. “We have some that are well-connected, we have some that are not so well connected,” said Virginia Secretary of Technology Karen Jackson. Given the lack of Internet access at home for many students, schools are opening after regular hours to fill the gap, Jackson said.

Internet infrastructure deficiencies also hurt higher education in Virginia. Rebecca Scheckler, an instructor at Radford University’s School of Nursing, notes her students who live in Pulaski County are required to take online courses, and those who work from home have limited Internet access. “We live in an underserved medical area,” Scheckler says. “I’ve had to advise well-qualified candidates to not go into the [nursing] program because they don’t have good Internet access.” In some regions, like California’s north coast, Internet cafes provide Internet access to consumers who cannot purchase it at home because no service is offered. Michael Nicholls, cochairman of Access Sonoma Broadband, supported the FCC’s adoption of regulations in early 2015 that subjects Internet service to the universal service mandate that has been in place for telephone service for decades.

Internet telecommunications is increasingly seen as being as vital to a region’s economic viability as other utilities, such electrical power. As knowledge work becomes more geographically independent, knowledge workers will need advanced telecommunications infrastructure at their doorsteps… That means fiber-optic connections offering symmetric upload and download speeds and scalability for future growth that is generally not offered by incumbent telco and cable companies.

America’s spotty, disparate Internet access is affecting where people choose to live—as well as where they choose not to live. In Door County, Wisconsin, [a peninsula in Lake Michigan] for example, it’s estimated that between 35 and 50 percent of residential premises have limited Internet access, and another 25 percent have no access. Door County Broadband CEO Kevin Voss says the lack of reliable Internet service makes the county an undesirable locale for people considering moving there.

A study by Broadband Communities magazine revealed a correlation between population trends and the robustness of telecommunications services. One of the publication’s editors, Steven Ross, conducted the research. He notes that the study’s findings correlate to a recent U.S. Commerce Department study that found for the first time in U.S. history, most rural counties lost population between 2010 and 2012.  (EDITOR’S NOTE: Rural population stabilized in the most recent report from the USDA Economic Research Service, which covered 2010 to 2015.)

The study suggests that U.S. settlement and land use patterns could strongly be influenced by the deployment of more robust telecommunications infrastructure in less populous areas of the nation—especially given the fact that much of today’s information and knowledge-based economic activity can take place most anywhere that infrastructure is available. This would balance out the distribution of economic activity that tends to concentrate in high-cost metro areas across a wider swath of the nation and help boost economic development in relatively less populated regions.

Deficient Internet telecommunications infrastructure in these areas of the nation lowers the ability of people to work remotely for distant employers and clients, of school children to access digital learning materials online, and of medical care professionals to interact with and monitor patients via telemedicine. Internet telecommunications is increasingly seen as being as vital to a region’s economic viability as other utilities, such electrical power. As knowledge work becomes more geographically independent, knowledge workers will need advanced telecommunications infrastructure at their doorsteps that can support videoconferencing and other interactive applications. That means fiber-optic connections offering symmetric upload and download speeds and scalability for future growth that is generally not offered by incumbent telco and cable companies.

In 2014, the Federation of State Medical Boards adopted a model policy designed to guide state medical boards in regulating the delivery of medical services remotely via telemedicine. That policy drew protest over its requirement that doctors and patients cannot rely exclusively on lower bandwidth applications such as texting, e-mail, and voice communications and instead must utilize higher bandwidth secure Internet videoconferencing. Opponents of the policy complained that the requirement wouldn’t be practical given Internet infrastructure gaps that don’t allow reliable video connections to patients in their homes.

The adverse impact of Internet access disparities on telemedicine was highlighted during an April 2015 hearing of the Senate Commerce, Science and Transportation Committee. Todd Rytting, chief technology officer of Panasonic of North America, testified that while providing Internet-based heartmonitoring services for elderly residents of the New York City area, his company found several places where there was no wired broadband, Wi-Fi, or strong mobile signals available. The SmartCare monitoring service significantly reduced the numbers of heart patients who had to return to the hospital, but “the biggest problem we faced was the lack of broadband to some of our citizens,” Rytting said. Some potential users of the service couldn’t get a broadband connection in “downtown New York City,” he added.

Telecom Infrastructure at an Inflection Point

In 2015, the United States is at an uncomfortable inflection point where the line extensions of telephone and cable TV services to Internet service have gone about as far as they can within their business models, leaving millions of American homes and businesses without modern Internet service and no immediate prospect of getting it.

Driving much of the discomfort is the lack of a successor to these business models that cannot achieve universal Internet service in the new century in a timely manner. The legacy providers have also reached the limits of their “triple play” business models—offering bundles of Internet data, TV video, and voice service—due to the high costs of TV programming. This provides them little incentive to bring fiber connections to about a quarter of the nation’s homes and small businesses that have remained unserved by modern Internet infrastructure for nearly more than a decade and stuck with dial-up and satellite and, where available, fixed terrestrial wireless service.

The problem has worsened in the past decade as telephone companies have concentrated their infrastructure investments on mobile wireless services while all but ignoring their deteriorating landline cable plants. Much of the landline cable plants are in such poor condition that they can’t deliver any Internet connectivity or can do so only marginally at sluggish speeds.

One strategy for the telephone companies going forward is to sell off portions of their copper cable network assets to smaller players, such as AT&T and Verizon have done. However, in portions of these companies’ service territories where the decades-old copper cable plant is in poor condition and a fully depreciated asset, it’s questionable what value any buyer would see in such a deal. Consequently, these companies have put those assets into runoff mode while milking a declining residual cash flow from a shrinking legacy landline phone services customer base and those stuck with slow, firstgeneration DSL at serviceable premises.

History is likely to judge the United States very harshly in how it met its Internet telecommunications infrastructure challenge. If the nation and its leadership had engaged in proper planning and budgeting a generation ago for the construction of ubiquitous fiber to all American premises, by now, the nation would be fully fibered and reaping the complete promise and value of the Internet.

Instead, the previous two decades were squandered on inaction.

Fred Pilot is from California and writes the Eldo Telecom blog, which covers broadband accessibility and policy.



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