Monday, February 02, 2009

Broadband stimulus

One of the items in the current spending package (I've decided not to call it a stimulus package) is some funding to help provide more broadband Internet connectivity to rural areas. The idea is to wire areas to the Internet in much the way they were wired to electricity during the New Deal era.
But it also seems like before we start wiring up Ma & Pa Kettle's house, we ought to make sure they want to use broadband. A survey done by the Pew Internet & American Life Project says that 2/3 of Americans that don't have broadband today, don't want it. The problem isn't availability. The problem isn't price. They just don't see any reason for things to move faster than with their dial-up modems In fact, "19 percent of dial-up users, for example, say that 'nothing' would get them to upgrade, not even lower prices." (see here)
Now you may think this is crazy. You're reading my blog and probably have some sort of high speed connection. But you're not the one targeted by this. Who is? Why it's the big Internet companies who stand to make the most from it. So let's call this the Internet bail-out part of the current spending plan.
A better way to handle this is to let the Internet providers fight it out themselves for speed. Charter is hawking a super-fast 60Mbps downstream Internet services (I think I'm running at 3Mbps, maybe 5Mbps and it works fine for me). Verizon is upgrading it's FIOS and is drooling over the possibility of getting some bail-out money. (see here)
Another option for high-speed Internet is to use a "cellular" card or "air card" as it is sometimes called. These cards can be used almost anywhere. When I travel, I sometimes find that they are faster than the hotel's "high speed connection."
The broadband stimulus needs to be cut out of the economic spending plan


David said...

I've seen that study and ones like it before, but it doesn't really change anything.

Time and time again it's been shown that people easily reject something until they see how it'll impact their lives. I remember several years ago they ran water lines to the houses on our road (before then we all had cisterns or wells), and a lot of people said the same types of things as they do about broadband. Want to take a guess how many of those people now use that water every day? My parents talk about the same thing happening back when electric was brought to the area.

I even know someone who swore up and down that he'd never own a cell phone. He's now on cell phone #6.

A lot of why this is necessary is to keep innovation going. There's already a lot of talk about how the Blue-Ray movie format will be killed by online movie downloads and rentals. While I think that talk is more than a little premature, what would people with dial-up do when that happens?

And one last thing: if you were looking to move somewhere, would you move to a place without broadband? Would you start a business in such an area?

It's easy to talk about cutting funding for something that you take for granted every day.

David said...

For the record, that last line was intended to get you to think about this from the angle of someone in an area without Broadband.

Re-reading it, it came across more like an insult (which really wasn't my intent).

Brooke said...

Spending package. That is the perfect name for it.

As for broadband, there are a good number of people who don't want it.

Take my grandmother, for instance. She lives independently in her own house, but wouldn't use a computer if someone gave her one and broadband was free. She has no use or patience for it.

Randy said...

Brooke, my mother-in-law is the same way. She took a "computer course" at the senior center and worked on learning to use the mouse for about 6 weeks. She finally gave up.

David, I didn't take anything you said as an insult. In fact, you're pretty much on target. We looked at moving last year and may move this year. One of the requirements of anywhere we look is that I have the ability to connect at high speed to the internet. That eliminates some choices. It also means that, in a newer neighborhood, the developer will have paid more for "infrastructure" and will pass that cost to me.

The question is, is that the job of government? I think not. I think the government should be about common defense, etc. At the local level, the government might be involved in things like internet for all. As for those who can't watch Blue-Ray, etc. I don't feel bad for them. My DVD player is over 10 years old and at Christmas, it wouldn't show the DVD slide show my brother created.

Private industry will build the infrastructure to handle increased band-width when the market requires it. Frankly, it isn't required today. The Verizon Ultra60 program I mentioned has very few followers. There simply isn't the market for it. (yet).

Every time I enter into this type conversation, I remember an old song that said "that isn't what the govern-meant."

David said...

My point about Blue-Ray was more about the possibility of no longer having an actual tangible format in favor of downloads and streams.

As for "that isn't what the govern-meant", why not? It's basically the same thing FDR did with the Rural Electrification Act (

Besides, a big reason why this is in there is to create jobs. People will be paid to put up these lines and other people will benefit from having them. It's much better than just sending out more checks.

WomanHonorThyself said...

massive spending bill subsidizing their own..what a joke!

"The Edge" said...

Whatever you want to call it, spending is spending. But spending for it's own sake is bad. Unless you get a productivity jump from the project in question, it's only going to drag you down. I happen to agree that the capitalism in private competition will clear up the situation more effectively than government can.

Will broadband increase the selling price of your home? Probably not. Will city water? Probably not. Will a Blu-Ray player? Probably not. But my inlaws live in a spot where cable TV is not an option, which forces them to get satellite if they want to watch something other than local TV, which being retired, they certainly do. And, it also forces them to pay more, in some ways because of all the packages the satellite companies have (and they don't even have the DVR receivers), if they could just learn to use the remotes....

Randy said...

Edge - At least the sattelite isn't blinking "12:00". City water and broadband may not increase the selling price, but they may very well increase the salability (if I can make up a word) of the house. It limits the number of buyers who may buy. But that's the seller's problem, not the government problem.

WomanHonorThyself - Thanks for visiting again. I plan to take on other parts of the spending bill as I have time. Keep reading.

David, I guess I don't understand your comments about Blue-Ray. I thought the format was selling now (apparently quite well) with the existing internet. I'm sure it will sell better with "enhanced" and rural-ified internet.

As for what the "govern-meant" (I need to find that song) the basic question is, what should the govern-mean? Somehow, providing an internet in every TV doesn't seem as critical as a chicken in every pot. Maybe this is appropriate for more local governments, but I don't think the federal government should be involved.

As for job creation, how many jobs will be created? Wouldn't those same jobs be created if private business invested and built the lines? Which is more efficient, government or private business? (I DON'T think the answer to that is a given).How can the governmeant stimulate that investment?

Thanks for visiting and stimulating conversation

"The Edge" said...

It might just depend on whose satellite box you have. Some of them blink 12:00 just like the other devices do....ha ha ha

But that isn't entirely my point. Some folks like well water. Nothing wrong with that. Some folks like satellite. Nothing wrong with that. I think ultimately, it's personal preference whether to buy/sell a home with those features. Same as putting on a new deck. You'll put one on if you like it or buy a home with one if you want it. But yes, that would add value to the house.

My thoughts are that in MOST cases (certainly not all), the private industry can do a job quicker and more efficient than a government-run bureaucracy can. Look at TV for example - why does the FCC exist? It should only to enforce that a minimum standard of decency is adhered to within the right of freedom of speech on the airwaves. It should not be telling us what cable company can or cannot enter a marketplace, or what dish company, etc. I figure if private enterprise does that, then the consumer gets the choice they want (to have broadband or not, etc.) and that competition will drive the price down so that if you want it and are willing to pay, you can at least afford the price. Many govenment (not all) services only end up driving the price up by the way contracts are done. People want answers when they (gov't) spend taxpayer money. But if private enterprise delivers a service, they have a built in incentive to do it cheaply, efficiently, and so on, because the bottom line is their profits. And when they make more, we can expect better service too.

Just my 2 cents.