FOR IMMEDIATE RELEASE
May 22, 2020
CONTACT:
Jana Plat
jplat@businessfwd.org
(202) 861-1270
Washington, D.C. — In response to the COVID-19 crisis and questions raised at a recent Senate Committee on Commerce, Science, and Transportation hearing on America’s broadband economy, Business Forward issued a report on current broadband performance, whether further government regulation is necessary, and how to close the digital divide.
Our COVID-19 Broadband Economy issue brief answers three critical questions about broadband access during the COVID-19 crisis. First, are broadband providers investing enough? Since 1996, broadband companies have invested more than $1.7 trillion. Last year alone, they invested more than $80 billion. “That’s more than the federal government invests each year on our highways, mass transit, and railroads,” said Jim Doyle, president of Business Forward. “And it pays off – these investments have led to faster download speeds and greater capacity.” In 2010, only 49% of households could access download speeds of up to 25 mbps (considered high speed). By 2018, that number grew to 93%.
The second question it answers is whether Washington should regulate broadband providers more. Since its classification as an information service in 1996, broadband has been subject to light-touch regulation rather than the heavier regulation that accompanies telecommunications services. “A simple way to compare whether broadband regulation improves network investment and performance is to compare the U.S.’s light-touch approach to Europe’s heavier regulation,” said Doyle. “You find that U.S. broadband companies invest nearly 2x more per capita on an annual basis than their European counterparts, and more households have access to high speed internet – 92% of U.S. households compared to 83% of households in Europe.”
The report also examines what happened when the U.S. government has managed broadband investment itself. Over 19 years, Congress appropriated $5 billion to the Rural Utilities Services (RUS) to provide broadband service to families in rural areas. Six different audits found waste, misuse, and mismanagement.
The last question the report raises is: what can we do to close the “homework gap” and rural digital divide? “It’s particularly important to bridge the gap during COVID-19, when millions of students were abruptly forced online to continue their schooling,” said Doyle. “Nearly 18% of U.S. students live in poverty, and 35% of households with children that have incomes of less than $30,000 per year lack high-speed internet access.” The report suggests combining steeply discounted broadband service with subsidized laptops and training for students and their parents in how to connect and use them, learning from best practices, and adopting a tech-neutral approach.
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With the help of more than 60 of America’s most respected companies, Business Forward is making it easier for more than 100,000 business leaders from across America to advise Washington on how to create jobs and accelerate our economy. Business Forward is active in over 125 cities and works with more than 650 mayors, governors, members of Congress, and senior Administration officials.