Low Income Communities Find Low Broadband Usage

Oct 13 2012
By Fred Hoot -

Low income communities have historically had a tough time using broadband.  Many influences, including economic and social have contributed to the lack of broadband usage.  Let’s examine some of the issues.

 

Comcast office Low Income Communities Find Low Broadband Usage

Provisioning

High speed internet provisioning was and still is a major stumbling block in many low income neighborhoods.  Equipping a neighborhood with fiber and/or cable is an expensive undertaking.

City and town permits and right of way purchases are rising as the town treasuries are looking for ways to increase their coffers.  Preparation costs, monthly utility pole space rental and utility tunnel space rental add to the cost of adding infrastructure to support high-speed broadband services.

And this is just the start.  Once the backbone infrastructure is in place, the “last mile” has to be installed.  This means installing cabinets on the streets with equipment to supply the final run to the homes and businesses.

Finally, equipment has to be provided at the subscriber’s premise for whatever flavor of high-speed broadband the provider is supplying.

Lack of Subscriber Base

It seems like a Catch-22 situation.  In order to be able to make it economically feasible to install all the infrastructure and last mile connections, there has to be a future subscriber base.  But the problem is due to a small subscriber base in low-income areas; not enough projected revenue is seen to eventually pay for the installation.  This makes it unattractive to ISPs (Internet Service Providers) to foot the bill for pulling new cable or fiber.

Newer Technology

There has been some recent technology in the DSL arena that is capable of bringing up to 400 Mbps to the subscriber’s home.  There are other solutions for 50 Mbps over the existing copper wire that all households and businesses presently have available to them.

There are several problems with this technology.  One is the cost of the equipment for the CO (Central Office) and equipment at the subscriber end.  The CO portion is the most expensive part of this and there still needs to be enough customers buying the service to pay for the equipment in a few years.

The next is distance.  A lot of low income neighborhoods are far away from the CO.  This means a high-speed DSL connection is not possible for those areas.

Infrastructure Solutions

The biggest solution for this dilemma is for someone to help pay for the infrastructure and the last mile infrastructure installation.  The FCC set up a National Broadband Plan (NBP) and Connect America to provide the funds to accelerate the installs of this infrastructure.  Grants and loans are provided to ISPs, large and small alike, to make the costs more palatable.

Even with the NBP help, many ISPs are not willing to provide a lot of additional funding necessary to complete such infrastructure projects.  They do not see where the ROI (Return On Investment) is coming from.

Some local ISPs have accepted the challenge and are working to bring the necessary broadband to the neighborhoods.  The surprising thing is that the local companies are having a good success rate.  Many cities and towns are also helping out by providing support and funding.

A Computer in Every Home

A move to bring laptops and tablets to low income communities is slowly taking shape.  Some cities have plans to provide computers to low income residents who have children in school.  Others are implementing programs for families of school children who qualify for a lunch program.

Comcast started a program to help low income families in Chicago and several other cities.  They are bringing cable to more low income areas.  They are also providing broadband service for $9.99 a month.

Computers worth $500 are being provided for $150 with the cost subsidized by Comcast.  This is just for families with children attending school.

The city of Chicago is also working on plans of its own to provide computers and high speed broadband service to all city residents in the future; at least that is their eventual goal.

Adoption

Eventual adoption of high speed broadband by every household will probably not happen.  There are many older citizens that simply do not want to have a computer. Some are stuck in their ways of getting along just fine with mail and telephones.  This is also observed in many rural areas of America, which also share a lack of high speed broadband infrastructure.

The lack of interest is not just constrained to the elderly.  Other people do not have the interest because the see no value in buying a computer and paying $10 a month (plus taxes and fees) each month on their limited incomes.

Adoption Solutions

While I do not see a 100% adoption of high speed broadband in the low income segments of America, I do see some solutions that can increase the adoption rate.

The first is education.  Educating the adult population will help them see how their life can be improved with broadband access.

Adult education courses set up at schools and libraries could reach out to the local residents and help them learn how to take advantage of what high speed broadband has to offer.  These courses could also teach the adults on how to use word processor programs and even other office modules.  This can lead to increased computer literacy and eventually expanded job opportunities for the residents.

Another solution is to provide free computer centers in libraries and maybe even schools for the residents who cannot afford even the subsidized pricing for broadband.

Certainly, some people will be able to improve their finances with these opportunities.  Maybe we will even see a few home-based businesses.

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