Elizabeth Warren has a plan to fix our internet divide. Would it work?

Oct 24, 2019

We have an internet problem in this country, and Elizabeth Warren has a plan to fix it.

Broadband speeds in the United States are the 10th fastest in the world, but also some of the most expensive at $58/mo., according to the most recent broadband report from the FCC. And the problem disproportionately affects poor and rural Americans.

Choose whichever stat you like: 44% of households with an income under $30,000 don’t have broadband; 26.4% of rural residents and 32.1% of people living on tribal lands did not have access to minimum broadband speeds (25 Mbps download, 3 Mbps upload), compared to 1.7% in urban areas; 79% of whites have home broadband, compared to only 61% of Hispanics and 66% of African Americans.

The FCC chairman put it more bluntly: “If you live in rural America, there’s a better than 1-in-4 chance that you lack access to fixed high-speed broadband at home, compared to a 1-in-50 probability in our cities.”

And this gap really matters. The Pew Research Center says that 24% of teens with a family income of less than $30,000 per year do not have the necessary equipment or internet connection to complete assignments. Another study saw test scores from low-income students with limited internet access rise by 30% after they were given smartphones.

At least six independent studies have also reached the conclusion that broadband access has a direct positive impact on job creation, GDP growth and consumer surplus. Microsoft wrote in its own analysis that “the counties with the highest unemployment also have the lowest broadband usage (and broadband access).”

As critical as the issue is, it has improved some already. When Bill Clinton first used the phrase “digital divide” in 2000, only 42% of rural residents used the internet. Today, that number’s up to 85% — better, but still far less than the 94% of suburban residents.

Despite the alarming numbers, the government has taken some steps to continue narrowing the gap. In 2017, the FCC committed $4.53 billion over 10 years to advance 4G LTE wireless internet in rural areas, and another $4.9 billion in August to expand rural broadband. 

But the divide still persists, and Elizabeth Warren has a plan to erase it.

Here’s how Elizabeth Warren would fix the digital divide

  • Invest $85 billion to expand broadband access
  • Allow small towns and rural areas to build their own broadband networks
  • Fix inaccurate FCC broadband maps
  • Limit anti-competitive ISP practices

“Just like the electric companies 80 years ago, today’s biggest internet service providers (ISPs) have left large parts of the country unserved or dramatically underserved,” Warren said. “This ends when I’m President. I will make sure every home in America has a fiber broadband connection at a price families can afford.”

Warren dedicated about 29% of her “My Plan to Invest in Rural America” post to a section called “A Public Option for Broadband.” This is slightly misleading — Warren isn’t actually planning to nationalize internet service — but it does argue for huge increases in federal investment. Here are the major points she outlined.

$85 billion in federal grants

The portion of Elizabeth Warren’s internet plan that has gotten the most attention is this $85 billion number — an eye-popping figure when compared to the government’s level of investment so far. For comparison, the FCC committed to spending $4.53 billion over 10 years in 2017 to advance 4G LTE wireless internet in rural areas.

Warren’s plan is different than what’s been done before in that only certain groups would be able to take advantage of the grant money.

Under my plan, only electricity and telephone cooperatives, non-profit organizations, tribes, cities, counties and other state subdivisions will be eligible for grants from this fund — and all grants will be used to build the fiber infrastructure necessary to bring high-speed broadband to unserved areas, underserved areas or areas with minimal competition.

The federal government would then pay 90% of the construction costs for these grants. $5 billion would also be set aside specifically for tribal lands, with the government paying for 100% of those costs. Applicants will also need to offer at least one plan of 100 Mbps download/100 Mbps upload speeds to use the grant money — well above the FCC’s definition of broadband (25/3).

Most of the Democratic candidates have voiced their support for rural broadband access, but only Joe Biden ($20 billion) and Pete Buttigieg ($80 billion) have put specific dollar amounts on their plans.

Would it work?

No matter how you look at it, closing the digital divide is going to cost a ton of money. It will require tens of thousands of miles of fiber-optic cable, which can cost over $100,000 per mile in some areas.

The FCC, which is responsible for broadband deployment nationwide, estimates that it would cost $40 billion to bring 25 Mbps speed broadband access to 98% of the country, and $80 billion to close the gap entirely.

Warren’s plan would invest enough in broadband to bring coverage to the entire country. Of course, those funds would still have to be approved by Congress. But throwing money at the issue hasn’t really worked in the past. From Microsoft’s report:

Despite the importance of this issue, we are not making very much progress in closing the broadband gap. In the past five years, there’s been more than $22 billion in subsidies and grants to carriers to sustain, extend and improve broadband in rural America. But adoption has barely budged.

Warren’s plan will address this by changing who is getting the money. Where grants in the past have been allocated to ISPs, Warren would limit eligible recipients to cooperatives, nonprofits and government entities.

Whether you think that will work depends on your thoughts on the government’s effectiveness in providing public goods compared to private companies. In either case, Warren’s planned investment of $85 billion so dwarfs what’s come before that it’s hard to believe it wouldn’t have a powerful impact.

Allow small towns and rural areas to build their own broadband networks

One of the key points in Elizabeth Warren’s internet plan is to create a federal statute that allows local municipalities to build their own broadband networks. As of right now, an estimated 25 states currently have laws on the books that either “roadblock or ban outright municipally-owned broadband networks,” many of them backed by the telecom lobby. The Institute for Local Self-Reliance (ILSR), a nonprofit supporting local broadband infrastructure, puts this number at 19 states, but in any case, it’s a lot.

Warren’s statute would preempt those state laws, making it legal for local municipalities to invest in their own communities where they’ve been overlooked by telecom companies.

Would it work?

Yes. These roadblocks range from mere annoyances to outright bans on local governments providing broadband to their citizens. No matter how severe, they exist primarily to decrease competition for the major telecom players.

Here’s how the ILSR describes the issue: “Much of this legislation is unnecessary and serves little purpose other than to please large telecom monopolies like Comcast and AT&T.”

There are always unintended consequences for sweeping changes like this, but on the whole, Warren’s federal statute would benefit rural communities greatly.

Fix inaccurate broadband maps

One of the biggest barricades to closing the internet gap has been inaccurate mapping from the FCC that dramatically underrepresents the number of Americans without broadband access.

I will appoint FCC Commissioners who will require ISPs to report service and speeds down to the household level, as well as aggregate pricing data, and work with community stakeholders — including tribal nations — to make sure we get this process right. Then, we will make this data available to the public and conduct regular audits to ensure accurate reporting.

This has been an issue for a while. Back in April, we wrote about how the FCC underestimated the number of people with broadband access by as much as 140 million. FCC Chairman Ajit Pai would revise that estimate a few days later, but only by a few million.

There remains a tremendous gap in what we know about who actually lacks internet access. As Microsoft wrote in its analysis, this discrepancy “leaves us with the unescapable conclusion that today there exists no accurate, comprehensive and public estimate of broadband coverage in the United States.”

Getting these numbers right is vitally important. This data is used by federal, state and local agencies to decide where to target public funds dedicated to closing this broadband gap. That means millions of Americans already lacking access to broadband have been made invisible, substantially decreasing the likelihood of additional broadband funding or much needed broadband service.

Would it work?

Warren’s plan to fix inaccurate broadband maps is light on specifics. It boils down to her ability to “appoint FCC Commissioners who will require ISPs to report service,” which every candidate would presumably do.

More specifics are needed from Warren to determine if this will work. There are simple fixes for broadband mapping that she never addresses, such as eliminating some of the vague wording on Form 477, which the FCC uses to collect broadband data from providers.

That said, Amy Klobuchar has been much stronger on this issue. The Senator introduced the Improving Broadband Mapping Act in March, which would allow the FCC to “consider using consumer-reported data and state and local data from government entities to improve broadband mapping accuracy” instead of relying entirely on data from ISPs.

Limit anti-competitive ISP practices

There are a host of actions in this section of Elizabeth Warren’s internet plan. She summarizes her objective like this:

Prohibit the range of sneaky maneuvers giant private providers use to unfairly squeeze out competition, hold governments hostage and drive up prices.

That means returning control of utility poles and conduits to cities, prohibiting landlords from limiting choice in internet providers on their properties and banning companies from restricting access to wires inside their buildings. She would also require new buildings to be fiber-ready and conduit to be laid anytime ground is dug up for public infrastructure.

Would it work?

Warren frames this portion of her plan as “taking on the evil providers,” but the specifics are far less exciting. But they all make a lot of sense, particularly the points on infrastructure.

Installing high-speed fiber-optic cable is incredibly expensive, but most of the cost comes with actually burying the cables and conduit underground. According to a Federal Highway Administration (FHWA) report, “Ninety percent of the cost of deploying broadband is when the work requires significant excavation of the roadway.”

A “Dig Once” policy is common sense, but it’s been difficult to enact at the national level. 11 states already have policies in place, but the same FHWA report argues against a federal policy that Warren advocates for.

Implementing Dig Once policies at the local, rather than at the statewide or national level, would be more effective given the complexities of implementing a policy that spans jurisdictions. Federal, state and local infrastructures, for instance, are subject to different laws regulating build-out plans for deploying broadband. In addition, most work for managing and maintaining utility facilities on roadways are the responsibility of counties and cities, including requests for utility permits to install and conduct work on existing facilities.

The bottom line

How you feel about Elizabeth Warren’s plan to fix the country’s internet access problem probably depends on how you feel about the government’s role in our society. She calls for dramatic action — and investment — to provide high-speed broadband access to the entire country, and she favors keeping that investment out of the hands of major ISPs.

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