John McDonald

John McDonald, managing partner of NEXT Studios

During the pandemic, I experienced something that fundamentally changed my perspective on a problem I thought was already solved. I attended a virtual meeting with a participant connecting from her car. When the meeting ended, I asked her why. It turns out, she had returned home to care for her parents in rural Indiana. Like many in their county, their home does not have access to high-speed Internet, so she was driving to the public library where they had boosted their wireless Internet. Why? So families could drive their students to the library to connect to teachers conducting e-learning classes from their cars in the parking lot.

In 2020. In Indiana.

According to the Federal Communications Commission’s 2019 Broadband Deployment Report, subtitled “Digital Divide Narrowing Substantially,” just over 90% of Indiana residents have broadband Internet access. Great news, right? The 10% that don’t equates to about 673,000 Hoosiers, which is a lot of people on the wrong side of the digital divide. How does that line up with parking lot e-learning? The answer is in the “access.”

To compile the report, the FCC asked telecom providers if they “can” or “do” provide services to at least one location in a particular census block. The wording of that question means the data is fundamentally flawed in three important ways.

First, they are not surveying actual people, but the providers. This is not unlike asking casinos to report how many of their patrons they think have a gambling problem. There is a built-in incentive for providers to reassure the agency that oversees their industry that all is well.

Second, if a provider could or does provide services to just one location in a census block, the entire block is considered to have availability, which means the rest of the census block could be in the dark, but counted as connected. That is a flaw that is made even more acute if census block members are geographically spread out as they are in rural Indiana, and overstates the reality.

Last, there is a huge difference between “can” and “do.” The question the FCC asks providers comingles the ability to provide service with the actual providing of service. Simply stated, just because you can provide broadband to someone doesn’t mean you actually are. It means that the FCC’s data on broadband access grossly overstates the actual situation.

How much is revealed by Microsoft’s ongoing project to close the rural broadband gap? They measured how many people do not use the Internet at broadband speeds, and for Indiana, that number is 4.2 million. This means only 37.6% of Indiana’s 6.73 million residents use the Internet at broadband speeds. Unsurprisingly, that’s not even across the state. Only two of Indiana’s Congressional districts, IN1 in Northwest Indiana, and IN5 in Central Indiana, have between 20% and 40% of residents accessing the Internet at broadband speeds: the remainder are at 20% or less.

The second finding lies in the definition of “broadband.” According to the FCC, this is speeds greater than 25Mbps, or the ability to send 25 million “bits” (a 1 or a 0 in binary numbers) per second over a connection. Sounds like a lot. However, their own “Broadband Speed Guide” reveals a single online user would need between 5 and 25Mbps to participate in work or school successfully. That means if you have two or more children or home workers online at once, your bandwidth needs will probably exceed what the FCC considers to be “broadband.” For comparison, my home broadband is 1 gigabit, or 1000Mbps, meaning my service provider’s definition of broadband is 40 times faster than the FCC definition.

These facts puzzle me even more when measured against funds spent to date on rural broadband projects. In 2019 the Next Level Connections Broadband Grant program, designed to award $100 million in matching grants to expand high-speed service, was launched. Service providers could apply for up to $5M for projects where no provider offered at least 10Mbps service (which is 60% slower than the FCC’s broadband definition). As of Oct. 1, 2020, $79 million has been awarded to connect about 22,000 homes.

The math reveals the challenge of relying solely on government to solve the problem. Seventy-nine million spent to connect 22,000 homes means it cost the State approximately $3,590 per home to complete a connection. If you apply the U.S. Census figure of 2.59 people per average household in Indiana against the 673,000 people the FCC says don’t have broadband access, it means we have 259,845 Indiana households without it, and at an average cost of $3,590 per home, it would take just short of $1 billion to provide access to everyone. And that’s just so that we “can.” The even larger hurdle to tackle is the “do” which is a whole other story.

John McDonald is a managing partner of NEXT Studios.

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