The Biden administration’s infrastructure plan includes $100 billion for bringing “affordable, reliable, high-speed broadband to every American.” The plan proposes a major shift in the way America finances and develops broadband networks across the country, prioritizing government-owned networks over those financed by private investment. But laying fiber for broadband across America is not analogous to pouring asphalt for roads. This is not the best way to accomplish the goal of connecting every American to broadband.
Policies for broadband buildout should encourage the creation of networks tailored to community needs, not government overspending for political effect. A combination of private investment and well-crafted public actions would result in a healthier overall level of network infrastructure investment than the Biden plan’s approach.
Senate Minority Leader Mitch McConnell has warned that Biden’s infrastructure plan is “a Trojan horse [hiding] more borrowed money, and massive tax increases on all the productive parts of our economy.” Investments in technology infrastructure should be designed and implemented with positive community outcomes in mind and a focus on growth, not imposing future financial restraints on communities and the country. As we have experienced over the past decade, investors’ ability to access market capital has been a boon to local communities who embrace investments in network access as part of their digital transformations.
Swapping human judgement and financial accountability for large government-funded programs has considerable downsides: consequences from faulty strategic planning and a lack of measurable outcomes for communities on how and where to concentrate their spending priorities. A 2019 study by the Technology Policy Institute’s Sarah Oh “did not find evidence that municipal broadband yields benefit in broadband subscription rates or employment growth.”
Advocates of government-funded broadband such as Susan Crawford have been badmouthing private market competition for years in favor of a “massive government mobilization” plan. She likes the end goal of 100 percent connectivity, but only at taxpayers’ expense. Apparently free-market ideas need not apply. In 2018, Crawford argued that “you can’t have advanced 5G wireless without fiber optic lines everywhere, which the US doesn’t have.” This would be news to many investors who have funded the research, development, and deployment of next-generation networks.
Jennifer Huddleston argued in January that “access in rural areas will require creative thinking and new technologies such as improved satellite internet. While calls for universal broadband may appeal to many, the reality of the cost to connect the most rural areas may make it difficult using only traditional broadband. The last two percent of households would cost $40 billion to connect.”
Infrastructure investment should bring economic opportunity to communities, and government spending isn’t the only way to achieve the goal of connecting citizens and bringing them the accompanying economic opportunities. Elon Musk noted in March 2020 that SpaceX’s Starlink satellite program would aggressively pursue the goal of bringing broadband to rural areas through a hybrid of technologies: It is “intended for about the 3 percent ‘hardest to reach customers’ for telecommunications companies, in rural areas where ‘5G is really not well-suited’ . . . SpaceX intends Starlink to have a high-speed connection for any users, with latency below 20 milliseconds.”
Amazon is also joining the satellite-to-broadband business with its Project Kuiper satellite constellation looking to bring broadband to unserved and underserved communities. While Musk called Amazon CEO Jeff Bezos a satellite copycat, we should welcome the two billionaires tackling the broadband access challenge and commercial competition between leading innovators over a county commissioner spending taxpayer funds to overbuild broadband in their community any day.
The internet is essential for modern life and access to commercial and government services. But infrastructure costs money and a collaborative effort between investors, industry, and governments can bring demand in line with long-term financing that can be designed to ensure maximum impact in communities currently lacking connectivity. Borrowing more money and enacting massive tax increases are not necessary to build out broadband in the US. Creating expensive government-sponsored programs financed through public spending is not a good idea: It will discourage capital market investing in next-generation networks by requiring the private sector to compete with government’s ability to spend without any regards towards outcomes.
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