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Ramon Nuez

Ramon Nuez

Posted: January 6, 2010 12:36 PM

A Broadband Connection Per Household

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For many of us that live in or near urban areas -- we are not too concerned about our Internet connection. For us it's simply not an issue. We come home, turn on our computers and we start surfing. Once we are online we purchase products, services, pay our bills and check those credit card balances. Over the past few years the Internet has gone through an evolution. It has gone from a static -- information push methodology to a dynamic -- information sharing methodology. It's this shift in the information architecture that has given birth to a number of platforms like YouTube, Google, Twitter, Hulu and Skype. We have come to know these services intimately. They have not only significantly changed our perspective of the Internet but forever changed how we use the Internet.

Some would say that broadband or "basic broadband" as defined by the FCC, is the catalyst that fed the evolution of the Internet. I say they are incorrect. It is the evolution of the Internet that fed, and continues to feed, the demand for broadband. Om Malik, from Gigaom explains:

It's easy to forget that it was the magical beauty of Napster, the then-illegal music-sharing service, that spurred many of us to sign up for DSL and cable broadband connections. Napster's popularity made it clear for the first time that broadband was a platform, no different than, say, Windows or the PlayStation. That's because it allowed for new applications to be developed and run on top of it, applications that consumed bandwidth -- and in turn, driving demand for even more of it.

Broadband is the platform which makes information readily available, where new business models are created and where the broadband technology is leveraged to connect the world. The Obama administration intimately understands the criticality of having a broadband connection, not only per household but in every school, library and hospital. This is the reason why President Obama has renewed focus on our information superhighway, a key component of his Economic Recovery Plan. The president explain:
It is unacceptable that the United States ranks 15th in the world in broadband adoption. Here, in the country that invented the internet,

To put this into some perspective the The Information Technology & Innovation Foundation (ITIF) explains that the United States is 15th out of the 30 - Organization for Economic Cooperation and Development (OECD) nations; Japan leads the OECD in broadband deployment. U.S. policy makers say that a strong U.S. national broadband policy is required. Currently the Federal Communications Commission (FCC) is drafting a national broadband policy which will be presented to Congress February 17, 2010. The primary goal of the national broadband policy is getting affordable broadband to every American.

Having a national broadband policy has little to do with policy or lack there of - it's financial. According to Blair Levin, FCC lead on the task force that is formulating the national broadband policy, building a new broadband infrastructure will run anywhere between $20 billion to $350 billion.

According to the FCC another major obstacle is the Universal Service Fund (USF).

The USF was originally designed to provide subsidies to pay for phone service in rural communities. But the task force believes that more of the $7 billion that is allocated each year from the fund should also be used to help subsidize the cost of deploying broadband in rural areas. Today, most of these funds are used for voice services and not broadband,

Another, in a long list of concerns, is that broadband service providers favor higher-income regions over low-income regions.

In response to the FCC's findings the ITIF makes a number of recommendations that would help in the adoption of a national broadband policy. The two recommendations that I think will lend itself to speeding up the process are:

1. Enact more favorable tax policies to encourage investment in broadband networks, such as accelerated depreciation and exempting broadband services from federal, state, and local taxation.

2. Continue to make more spectrum, including "white spaces," available for next-generation wireless data networks.


Gigaom is interviewing (live stream) the new FCC chair, Julius Genachowski, tomorrow. I will be listening in on the interview and update you with any new information.

 

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