The U.S. Congress should keep money for broadband deployment in a huge economic stimulus package, despite some calls to trim it out of the bill, representatives of three groups said Friday.
As the U.S. Senate debated cuts to a US$890 billion stimulus package, representatives of the Information Technology and Innovation Foundation (ITIF), the Communications Workers of America and Connected Nation, called on the Senate to keep funding for building broadband networks in rural and other underserved areas.
The Senate version of the economic stimulus package originally included $9 billion for broadband deployment, about $3 billion more than a House of Representatives’ stimulus bill that passed Jan. 29. Late Friday, senators continued to debate their own stimulus bill, with several lawmakers calling for significant cuts in the spending package. One proposal would cut the broadband spending by $1.5 billion.
Money for broadband is important to help rural and some urban areas realize the economic and social benefits of broadband, said Raquel Noriega, director of strategic partnerships at Connected Nation, a nonprofit group focused on helping communities expand broadband deployment.
“I cannot see a better way” to stimulate the economy, she said during an ITIF forum on broadband stimulus in the U.S. Capitol.
Some groups have questioned whether there’s a need for broadband deployment money in the bill. On Jan. 21, New York Times tech columnist Saul Hansell suggested that broadband providers would reach most of the nation without a large amount of stimulus money. Using new cable modem technology, the U.S. should be able to surpass other nations’ broadband speeds, he wrote.
“As I look at it, the noise about a broadband gap is hooey,” Hansell wrote. “With new cable modem technology becoming available, 19 out of 20 American homes eventually will be able to have Internet service that is faster than any available now anywhere in the world.”
Hansell suggested the stimulus package should focus on unserved areas instead of spending tens of billions [b] of dollars to increase speeds in areas already served by broadband providers, as some groups have called for. “It is hardly clear that the country would get an adequate return from subsidizing what is essentially duplicate capacity,” he wrote.
Berin Szoka, a fellow at conservative think tank the Progress and Freedom Foundation, also questioned how the government will be able to gauge the effectiveness of any stimulus money for broadband. He suggested the broadband stimulus is “corporate welfare” in a Jan. 20 blog post.
“How would one actually evaluate the efficacy of any proposed government intervention?” Szoka wrote. “As difficult as it is to predict the unintended consequences of intervention, it’s even more difficult to do so in high-tech sectors of the economy, where the rate of change is particularly rapid.”
But stimulus money will be needed to reach that last 5 percent to 10 percent of U.S. residents who don’t have access to broadband, said Robert Atkinson, ITIF’s president. Many of those people are in rural areas where broadband providers have been reluctant to provide service because of the cost per customer, he said.
“You can’t make the money back at $35 a month,” he said. “The numbers don’t work.”
Atkinson called on Congress to approve a mixture of tax cuts and grants to help broadband providers expand service. While a grant program would take time to set up, tax cuts would encourage providers to expand their networks almost immediately, he said.
He also called on Congress to get rid of open access and net neutrality requirements, as well as speed requirements, in the House version of the stimulus package. The House bill would require the U.S. Federal Communications Commission to define open access rules, and those rules could potentially include requirements for broadband providers to share their networks with competitors, he said.
Proponents of the open access rules say they’re needed to keep broadband providers from blocking or slowing access to some Web content. But Atkinson said those requirements could drive away broadband providers from accepting stimulus money. With the requirements in place, “you’ll see very little take-up of the grants,” he said.