Don't need broadband? Think again as providers look to educate consumers
A couple of years ago I was having dinner with my uncle during a stopover in San Francisco. The conversation, as it is wont to do, turned eventually to the Internet, specifically to Facebook, which my uncle had joined but was not posting to very much. Why? I asked.
"Because it takes too long to load," he replied. "I have dialup."
I found this pretty amazing, considering he lives close enough to the city to get high-speed Internet, so I quizzed him a bit more about his reasons for staying with a dialup service. He had fairly sound ones: the price was very affordable; he wasn't locked into a service contract--important because his carpentry work often took him out of town for weeks at a time; the service was reliable; and he didn't see much use for Internet access beyond checking his email.
That conversation took place just as the Obama administration's broadband stimulus effort was gearing up, an initiative that now is in full swing, with broadband rolling out--at various speeds--well beyond urban areas and into rural ones. So I was very interested to see the results of a recent study that found that not only did 28 percent of Minnesota residents not subscribe to a broadband service, a significant portion of them weren't that interested in subscribing: 29 percent of those without broadband said there wasn't enough Internet content worth viewing.
Only 8 percent of the survey participants said that they didn't have access to broadband, so in the parts of Minnesota surveyed, which included rural areas, broadband access was not the biggest issue.
Minnesota wasn't the only state surveyed as part of an effort by Connected Nation. In South Carolina--where a battle for municipal broadband regulation was fought recently--around 43 percent of residents do not subscribe to broadband. Again, only 8 percent said broadband was not available to them.
These two stats alone don't paint an entire picture of the problem, of course. There are a number of reasons why a significant percentage of consumers aren't cottoning to broadband (the national average is 35 percent). Access--both to broadband service and to the computers needed to run it--is one issue; price is another. Eighteen percent of South Carolina residents cited the cost of broadband as a barrier. Low-income households, particularly low-income seniors, were most likely not to subscribe to broadband.
Looking at numbers like these, it's easier to draw the conclusion that those who don't find Internet content of interest--whether for entertainment, running a business, searching for a job, or communicating with friends and relatives--actually can't find it, because their connection (or even their PC) is too slow to handle dynamic Web content, or they have no way to connect at all.
In conjunction with the ongoing broadband stimulus drive, service providers have geared up to solve the problem of increasing broadband adoption at the consumer level. Some have been compelled to do it: Comcast (Nasdaq: CMCSA), the most visible example, is offering $9.95 per month high-speed access in an increasing number of locations to low-income residents as a concession to gain FCC approval of its merger with NBCUniversal. CenturyLink (NYSE: CTL) is offering a similar service in its areas as part of a requirement of its Qwest acquisition.
But just offering affordable broadband service isn't enough. Getting people interested in what the Internet has to offer is a significant challenge as well. That's where nonprofit agencies like One Economy Corporation come in: providing access alongside education in how to find the best of what the Internet offers, such as easier access to job listings, faster communication and increased business opportunities. Connected Nation, through its Every Citizen Online program, is providing computers to low-income families in Tennessee, Kentucky, and Ohio. Both are working with public and private partners, such as AT&T (NYSE: T), to conduct and expand these programs-and they're among a number of nonprofits in each state looking to improve broadband access.
Yet despite the increasing efforts to educate consumers, there's still a nagging question: Will price continue to be a barrier to entry? Right now, a low-income family that has access to CenturyLink's $9.95 per month service will only have that price point for 12 months. After that, it's $14.95 to continue to access 1.5 Mbps. Comcast's qualifying low-income subscribers will only be able to apply to the program for three years, after which the MSO won't have to offer it at all. And for nonprofits that have set up broadband access points in low-income housing communities in places like Chicago and San Diego, what will happen when/if funding runs out and the broadband tap is turned off? What alternatives will low-income subscribers have at those exit points?
These are questions that providers, broadband educators, and the government need to answer as the clock ticks down toward the deadline for full broadband access.--Sam