Broadband++the+Road+to+21st+Century+Economic+Growth

8/6/2019 Broadband++the+Road+to+21st+Century+Economic+Growth

1/41

Broadband:TheRoadto21stCentury

EconomicGrowth

ByM madiladAlemoham

2009 Wise Intern

1

August 2009

Sponsoredby:


2/41

AbouttheProgram

Foundedin1980throughthecollaborativeeffortsofseveralprofessionalengineeringsocieties,

theWashingtonInternshipforStudentsofEngineeringhasbecomeoneofthepremier

Washingtoninternshipprograms.Itsgoalistogroomfutureleadersoftheengineering

professionwhoareawareofandcancontributetotheimportantintersectionsoftechnology

andpublicpolicy.

Acknowledgement

Firstandforemost,IwouldliketothankIEEEUSAforsponsoringmeforthe2009WISE

program.IwouldspecificallyliketothankEricaWissolikandRussellHarrisonfortheir

mentorshipinwritingthispaper.IwouldalsoliketothankChrisBrantleyfortakingtimeto

providemewithhisgoodreviews.

Additionally,IwouldliketoacknowledgeinvaluableinsightsandadviceIreceivedfromDr.John

Richardson,Dr.MichaelMarcus,Dr.BruceEisenstein,Ms.EmilySopensky,andMr.Don

Thomas.

Lastly,IwouldliketothankMelissaCarl,andourfacultymemberinresidence,

D

a

r.DanielDeckler.IwouldalsoliketothankMr.JohnBuydosattheLibraryofCongressforhis

ssistance,andeachofmyfellowWISEinternsformakingthisprogramsounique.

2


3/41

TableofContents

Sponsoredby.................................................................................................................................. 1

1. Introduction............................................................................................................................. 4

1.1 Motivation:ProblemDefinition....................................................................................... 4

1.2 PlanofDiscussion............................................................................................................. 6

2 TheStateofBroadbandinAmerica......................................................................................... 8

2.1 Broadband:DifficultieswithDefinition,DataandStatistics............................................8

2.2 CapabilityandAvailabilityofBroadbandBackboneandMiddleMile:..........................12

3. WhyUniversalBroadbandMatters?..................................................................................... 17

3.1 BroadbandandRuralDevelopment............................................................................... 17

3.2 BroadbandandItsPotentialImpacts............................................................................. 19

4. FactorsAffectingBroadbandAdoption............................................................................... 233

5.WhatistheSolution:PolicyRecommendations..................................................................... 277

DataCollection:................................................................................................................... 277

Technology:......................................................................................................................... 277

Supply:................................................................................................................................... 29

Adoption:............................................................................................................................. 322

6. Appendix.............................................................................................................................. 344

i. NeedforSpectrumManagement.................................................................................... 344

ii. AvailableMiddleMileOptions......................................................................................... 377

iii. ApplicationTable............................................................................................................. 400

3


4/41

1. Introduction

1.1 Motivation:ProblemDefinition

Broadband

is

a

driving

force

in

the

21st

century

economy.

High

speed

Internet

contributes

positivelytojobcreation,education,economicdevelopmentsandincreasedproductivity.

AccordingtoareportpublishedbyConnectedNation,TheEconomicImpactofStimulating

BroadbandNationally,acceleratedbroadbandadoptionresultsinadirectestimatedeconomic

growthof$134Billionannually.1

TheAmericanRecoveryandReinvestmentActof2009invested$7.2billioninbroadbandstimulusanddirectedtheDepartmentofAgriculturesRuralUtilitiesServices(RUS)andthe

DepartmentofCommercesNationalTelecommunicationsInformationAdministration(NTIA)to

expandbroadbandserviceaccesstounservedandunderservedregions,stimulatejobcreation,

spurinvestmentsintechnologyandinfrastructuresandprovidelongtermeconomicbenefits.

AsaresultNTIAandRUSstartedthe$4.7billionBroadbandTechnologyOpportunitiesProgram

(BTOP)andthe$2.4billionBroadbandInitiativesProgram(BIP).

BIPprovidesloansandgrantsforbroadbandinfrastructureprojectsinruralAmerica.BTOP

fundsbroadbandinfrastructureprojects,publiccomputercenters,andsustainablebroadband

adoptionprojects.2

NTIAwillspendatleast$200millionongrantstoexpandbroadbandaccessatpubliccomputer

centerssuchascommunitycollegesandpubliclibraries.Theagencieswilluseanother$350

1ConnectedNationInc.,TheEconomicImpactofStimulatingBroadbandNationally,availableat

http://www.nga.org/Files/pdf/0812BROADBANDCONNECTED.PDF .2http://www.broadbandusa.gov/

4
http://www.nga.org/Files/pdf/0812BROADBANDCONNECTED.PDFhttp://www.nga.org/Files/pdf/0812BROADBANDCONNECTED.PDF


5/41

milliontocreateabroadbandinventorymap,andfinally$250millionwillbeusedtomake

grantsforinnovativetechnologiessuchasWiMax.

3.9

0.25

0.350.2

BTOPFunding($billion)

InfrastructureProjects

InnovativeTechnologies

InventoryMap

PublicComputerCenters

Table1.BTOPfunding

NTIAandRUSwillmakefundsavailableinthreedifferentrounds.OnJuly1,2009,theagencies

jointlyissuedaNoticeofFundsAvailability(NOFA).3UnderNOFA,$1.6billioninBTOPfundsis

availableforawards,and$1.2billionisdesignatedtofundprojectsthatexpandservices

throughMiddleMileandLastMileinfrastructurestounservedandunderservedareas.

Expandingbroadbandtounservedandunderservedregionsisimportantbecause:

1) HighspeedInterneteliminatesthephysicaldistancesandenablespeopletoaccess

resourcesthatenhancetheirwelfare

3NoticeofFundsAvailabilityavailableat

http://broadbandusa.sc.egov.usda.gov/files/BBpercent20NOFApercent20FINALpercent2007092009.pdf.

5
http://broadbandusa.sc.egov.usda.gov/files/BB%20NOFA%20FINAL%2007092009.pdfhttp://broadbandusa.sc.egov.usda.gov/files/BB%20NOFA%20FINAL%2007092009.pdf


6/41

2) Broadbandprovidesruralsocietieswithbettereducationalresources,onlinecourses,

andincreasedcommunications

3) Applications

such

as

telemedicine

and

information

health

technology

cannot

be

broadly

deployedwithoutaccesstobroadband.

Thedifficultiesassociatedwithaccessandadoptionofbroadbandaremultifold.Ruralareas,

duetotheirlowpopulationdensitiesandlongdistancefromurbanandsuburbanareasreceive

verylittleattentionfromserviceproviders.Lackofeconomiesofscalehasmadeitinefficientto

expand

infrastructures

to

rural

regions.

Furthermore,socioeconomicfactors(suchaslackofbasicinfrastructures,economic

inefficiency,andthedigitaldivide),theinabilitytoaffordservices,andtechnicalrequirements

(suchasincreasinguseofbandwidth4)offerchallengestoexpansionofbroadbandservicesto

ruralareas.

1.2 PlanofDiscussion

Asummaryofsectionsinthispaperisincludedbelow:

Sectiontwowillfocusonthecurrentstateofbroadband.Inthissection,appropriatedefinitionsforrural,unservedandunderservedareproposedanddifficultieswithavailabledata

onadoptionandaccesstobroadbandarediscussed.Thissectionalsodealswiththecurrent

technologicalpossibilitiesinliftingthebarriersagainstbroadbandexpansion.

4Consumerbandwidthusagehasgrownrapidlyoverthepastdecade.Ifthegrowthcontinueswiththesamepace,

Mooreslawsuggeststhatneedforconsumerbandwidthwillexceed380Mbpsintenyears,andoneGbpsin

thirteenyears.

6


7/41

Sectionthreeexplorestheimportanceofexpandingbroadbandtoruralareas.Thissectionfocusesonruraldevelopmentsandimpactsofbroadbandadoptiononthesocietyand

economicgrowth.

Sectionfourconsidersbroadbandadoptionbythehouseholdsandidentifiesthefactorsthatimpacthouseholddecisionmaking.Whilethissectionfocusesontheavailabletechnologiesin

providingcheaperservices,sectionfourputsemphasisonwaysbywhichwecaninfluence

servicetakeupamonghouseholds.

Sectionfiveproposesappropriatepoliciesthataddresslackofaccessandadoptioninunservedandunderservedareas.Theproposedpoliciescanbecategorizedas:

Datacollection

Technology

ProvidingmorespectrumbytheFederalCommunicationsCommission(FCC)for

wirelessbroadband

ProvidingR&Dtaxcutsinunservedandunderservedtopromotemarketdrivers

Supply

Preparearuralbroadbanddevelopmentmap

Improvethemiddlemileinfrastructuresthroughcooperationwiththe

Department

of

Transportation

Adoption

Makemorefundsavailableforschoolsandpubliclibraries

Extendthelifelonglearningtaxcredittocoveraccesstobroadband

7


8/41

2. TheStateofBroadbandinAmerica2.1 Broadband:DifficultieswithDefinition,DataandStatistics

FCCdefinesthefollowinglevelsofbroadband:5

Greaterthan200kbpsbutlessthan768kbps

Equalorgreaterthan768kbpsbutlessthan1.5Mbps

Equalorgreaterthan1.5Mbpsbutlessthan3Mbps

Equalorgreaterthan3Mbpsbutlessthan6Mbps




Equal

or

greater

than

100Mbps

Table2.BroadbandtiersdefinedbyFCCDefinitionsToaccomplishacomprehensiveanalysisofthecurrentstateofbroadbandinruralAmerica,itis

importanttofirstidentifyaproperdefinitionofwhatconstitutesrural,unserved,and

underserved.6

Unlessotherwisespecified,thisreportusestheCensusBureausdefinitionofrural.TheCensus

Bureaudefinesruralasallterritoriesoutsideofanurbanarea.Thebureaufurtherclassifiesan

urbanareaonthebasisofpopulationdensity.Urbanareaincludesacentralcityandthe

surroundingdenselysettledterritorythattogetherhaveapopulationof50,000ormoreanda

populationdensitygenerallyexceeding1,000peoplepersquaremile.7Accordingtothe

5FCCdefinesbroadbandTiersinitswebsite,WCDocketNo.0738.6Unfortunately,thedefinitionsofruralevenbytheUSgovernmentcauseconfusionandprovidedifferent

quantitativemeasures.Currentlytherearemorethantendifferentdefinitionsavailableforrural.Government

agenciesbasedontheirpurpose,defineruralbyconsideringfactorssuchasqualityofservice,population,

populationdensity,industrialactivity,etc.7TheBureauoftheCensusdefinesanurbanizedarea,http://www.census.gov/population/censusdata/urdef.txt,

(UA)bypopulationdensity.Accordingtothisdefinition,eachUAincludesacentralcityandthesurrounding

8
http://www.census.gov/population/censusdata/urdef.txthttp://www.census.gov/population/censusdata/urdef.txt


9/41

Bureau,97.5percentofUnitedStateslandareaand25percentofthetotalnationspopulation

areconsideredrural.8

Figure1.U.S.populationdensitymap

Asfarasdefinitionsforunservedandunderservedareasareconcernedthisreportfollows

thoseputforthbytheNTIA.TheNTIAdefinesunservedandunderservedareasas:

UnservedArea:anareacomposedofoneormorecontiguouscensusblockswhereatleast90percentofhouseholdsintheproposedfundedservicearealackaccessto

facilitiesbased,terrestrialbroadbandservices,eitherfixedormobile,attheminimum

broadbandspeed.

UnderservedArea:anareacomposedofoneormorecontiguouscensusblockswhereatleastoneofthefollowingismet:1)nomorethan50percentofhouseholdsinthe

proposedfundedserviceareahaveaccesstofacilitiesbased,terrestrialbroadband

serviceatgreaterthantheminimumbroadbandspeed;2)nofixedormobilebroadband

denselysettledterritorythattogetherhaveapopulationof50,000ormoreandapopulationdensitygenerally

exceeding1,000peoplepersquaremile.A"county"isapoliticaldistinctionandisnotincorporatedintheBureau

oftheCensus'classificationscheme,sooneUAmaycoverpartsofseveralcounties.

Underthisdefinition,allpersonslivinginUA'sandinplaces(cities,towns,villages,etc.)withapopulationof2,500

ormoreoutsideofUA'sareconsideredtheurbanpopulation.Allothersareconsideredrural.

8Seehttp://www.census.gov/population/censusdata/urdef.txt.

9
http://www.census.gov/population/censusdata/urdef.txthttp://www.census.gov/population/censusdata/urdef.txt


10/41

servicesprovideradvertisesbroadbandspeedsofatleast3Mbpsdownstreaminthe

proposedfundedservicearea;or3)therateofbroadbandsubscribershipforthe

proposedserviceareais40percentofhouseholdsorless.9

AccessandadoptiontotheservicesaretwokeystodefinitionsputforthbytheNOFAfor

unservedandunderservedareas.Whileaccessisdrivenbyprovisionofmiddlemileandlast

mileinfrastructures,adoptionisindirectrelationtofactorssuchashouseholddecisionmaking

behaviorandbusinessactivitiesinagivenarea.

DifficultieswithBroadbandDefinitionsandDataLackofacommondefinitionandtheethicalneedforbusinessestokeepcorporateinformation

confidentialhavebothcontributedtodifficultiesincollectionofdataonbroadband

availability.10

Inadditiontothedifficultieswithdatacollection,therearealsosomeproblems

withtheexistingdata.Forinstance,theFCCestimatesthatmorethan99percentofzipcodesin

UnitesStatesenjoyatleastoneInternetServiceProvider(ISP)withconnectiontoanenduser

withinthegeographicalregion,andconcludesthatInternetservicesareavailabletomorethan

99percentofthenationspopulation.11

Theproblemwiththisestimateisthatitallowsasingle

businesssubscribertorepresentazipcodeareaofanysizeandpopulationdensity,without

providingaclearcountoftheactualnumberofhousesandbusinessesthataccessbroadband

servicesinthatregion.Moreover,manyruralandurbanareassharethesamezipcodeareain

theUnitedStateswhichmakesthecurrentdataunreliable.

9NoticeofFundsAvailabilityavailableat

http://broadbandusa.sc.egov.usda.gov/files/BBpercent20NOFApercent20FINALpercent2007092009.pdf.10

See http://www.usiia.org/pubs/Rural.pdf P.1111

FederalCommunicationsCommission(FCC)GNDocketNo.0745.InquiryConcerningtheDeploymentof

advancedTelecommunicationsCapabilitytoAllAmericansinaReasonableandTimelyFashion,andPossibleSteps

toAccelerateSuchDeploymentPursuanttoSection706oftheTelecommunicationsActof1996.FifthReport

0888Washington,DC:June12,2008.

10
http://broadbandusa.sc.egov.usda.gov/files/BB%20NOFA%20FINAL%2007092009.pdfhttp://broadbandusa.sc.egov.usda.gov/files/BB%20NOFA%20FINAL%2007092009.pdf


11/41

Thedifferencebetweenavailability,penetrationandqualityofserviceisalsooftenneglected

whenpreparingreportssuchasthis.Evenifwetake99percentserviceavailabilityforgranted,a

disparityremainsinadoptionratesbetweenruralandurbanareas.The2008PewBroadband

AdoptionStudyfoundthatonly38percentofruralresidentshavebroadbandattheirhomesas

opposedto57to60percentoftheircounterpartsinurbanandsuburbanregions.12

Figure2.Internetadoptionmap13

12SeePEWINTERNET&AMERICANLIFEPROJECT,HOMEBROADBANDADOPTION2008,at3(2008),availableat

http://www.pewInternet.org/~/media/Files/Reports/2008/PIP_Broadband_2008.pdf(2008PEWBROADBAND

ADOPTIONSTUDY).ThesurveywasconductedbyphonefromApril8,2008toMay11,2e008among

2,251Americanadults,1,153ofwhomwerebroadbandusers13

Availableatwww.ers.usda.gov/publications/agoutlook/JuneJuly2002/ao292h.pdf

11
http://www.ers.usda.gov/publications/agoutlook/JuneJuly2002/ao292h.pdfhttp://www.ers.usda.gov/publications/agoutlook/JuneJuly2002/ao292h.pdf


12/41

2.2 CapabilityandAvailabilityofBroadbandBackboneandMiddleMile:14Interoperabilitybetweenaccesspoints,backbone,middlemiletransportlines,andlastmile

infrastructure

is

a

necessary

requirement

for

any

successful

broadband

project.

This

section

exploresthecapabilityandavailabilityofbroadbandbackbone,middlemileandlastmile

infrastructures.

BackboneThemajorityofthenationsbroadbandbackboneiscomposedoffiberopticcables,with

satellitelinksconnectingareasthataredifficulttoreachbylandlinesorunderwatercable.Fiber

providesanalmostunlimitedcapacityoftransportingdataathighrates.Withcurrentwave

divisiontechnologyitispossibleforasinglefibertocarry400Gbpswhichisequivalentto

520,000broadbandsignals(at768Kbps)or6milliontelephonecalls(at64Kbps).15

CompaniessuchasAT&T,MCI/WorldCom,Sprint,Qwest,Level3,ITXC,andWilliamshavebeen

rapidly

building

data

networks.

There

are

currently

more

than

40

Internet

backbone

providers.

$13.5billioninvestmentsinbackboneinfrastructuresin2001ledtoincreasedcompetition

whichinturnmadebroadbandeconomicforbackboneproviders.However,thesebackbone

infrastructuresarelaidalongthemajorpathways,tensofmilesawayfrommostruralandex

urbanareas.

14Backboneisthemajor,highcapacityfiberlinefromwhichInternetistappedintosmallerregions.Thereareonly

300backbonepathsavailableintheentireworld.15

JarboeKenan,KnowledgeManagementAsanEconomicDevelopmentStrategy,2001,P.5availableat

http://www.eda.gov/PDF/1G3LR_6_jarboe.pdf

12
http://www.eda.gov/PDF/1G3LR_6_jarboe.pdfhttp://www.eda.gov/PDF/1G3LR_6_jarboe.pdf


13/41

MiddleMileBesideslowpopulationdensity,distancefrommajorbackboneinfrastructuresmakestransfer

ofbroadbandservicestoruralareasprohibitivelyexpensive.AccesstohighspeedInternetwill

onlybepossiblethroughexpansionofcurrentmiddlemilenetworkstoeliminatethebarrier

againstlocalprovidersindevelopingthelastmileinfrastructures.Middlemiles,asthe

interstatehighwaysandhighvoltagepowerlineswere,requiredirectattentionbythe

governmentofficials.Theseinfrastructures,duetotheirsignificantconstructioncostandlackof

marketforces,areunattractivetomajorproviders.Ononehand,weakeconomiesofscale

prohibithighcapitalcompaniestoinvestinmiddlemileinfrastructures,andontheotherhand

smalllocalproviderscannotaffordconstructingtensofmilesofnetworksbetweenbackbone

andruralcommunities.

Provisionofmiddlemileinfrastructuretoruralareasissubjecttocompromises.While

expensivefiberlinessupportupto400Gbps,stateoftheartwirelesstechnologiescansupport

uptoonly1Gbpspermiddlemilelink(1300broadbandconnections,assumingthatevery

subscriberisatfullcapacity).However,transmissioncostusingwirelesstechnologiesis

estimatedtobe80percentlowerthanfiberlinks.Forathreemilelink,costsavingsusing

wirelessisashighasnearly$2millionperlink.Giventhat70percentofruralareasareatleast

70milesawayfromtheInternetbackbone,wirelessmiddlemileinfrastructurecansave

providers

over

$46

million

per

link16

.

It

is

also

important

to

note

that

scarcity

and

16Foradetaileddescriptionofalternativemiddlemileinfrastructuresrefertoappendix.

13


14/41

underutilizationofspectrumnearmetroandsuburbanareas,wheremiddlemileinfrastructures

aretapped,callsforbetterspectrummanagementpolicies.17

LastMileInadditiontomiddlemile,thelastmileinfrastructuresareconsideredasaseriouschallengefor

networkproviders.Lowpopulationdensityandlackofeconomiesofscalemakeexpansionof

highspeedInternetprohibitivelyexpensive.

Internetproviderswillexpandtheirservicesinpresenceofmarketforces.Marketforces

guaranteeprovidersareturnofinvestmentinfaceoftheirtotalcostofownership(TCO).TCO

comprisesoftwocostcategories;theCapExandOpEx.WhileCapExincludesexpensesrelated

toplanning,andinstallationofhardwareandsoftwareandinitialconfigurationcosts,theOpEx

coversexpensesrelatedtonetworkmanagement,monitoringtroubleshootingandsupport.18

Wirelesstechnologiesofferpromisesindeliveringcheaperservicestousersinareaswithlow

populationdensity.Inadditiontothesimplicityandreductionincostwirelesstechnologyalso

offersmoreflexiblenetworkingbyenablingpointtomultipoint(PTMP)access.19

Wirelessisan

attractivesolutiontoareaswithlowpopulationdensityandweakeconomiesofscale.

ThefollowingexampledemonstrateshowWiMAX,agrowingwirelesssolution,haschangedthe

lifeofruralresidentsinAlstonMoore.

17Refertoappendixforadetaileddiscussionofspectrummanagementpolicies

18FarpointGroup,Wirelinevs.Wireless:Exploringtotalcostofownershipinoutdoorapplications,June2009

19Onetransmittercansendsignalstomanyreceivershencemakingthesystemmoreflexiblebyeliminatingthe

needtodirectwiredlinks.

14


15/41

CybermoornetworkoffersitsWiMAXservicestohousesinAlstonMoor,atownwith2,500

residentsonthecostofnorthwesternEngland.InadditiontohighspeedInternetthenetworks

provideservicessuchastelemedicineanddistancelearning.WiMAXhasnotonlymade

residentialbroadbandpricesaslowas$14.5amonthforupto12Mbps,butithasledtoa

CapExsavingofmorethan$700,000andareturnofinvestmentofabout25timetheamount

invested.20

Itisimportanttopointthatwirebasedtechnologies,duetheirenormousCapEx

cost,couldneverbeemployedinsucharea.

Inconjunctionwithexistingtechnologies,newnetworkarchitecturescanalsohelpinreducing

theconsumerprices.Theabilitytoshareresourcesisakeydriverinreducingthenetwork

servicecosts.Wirelessnetworkarchitecturescanalsoundergochangesinunservedareas.

Currently,theprevalentmodelforhomeaccesstothebroadbandtechnologiesisthatofstar

topologywheretheusersareconnectedtothehob(centraloffice)withanaccessline.Multi

hubwirelesstopologiesarepromisingandcanoffernewadvantages.Inthiswirelessaccess,a

fixedwirelessaccesspointistypicallymountedontherooftopofasmallwirelesscoveragearea

calledahobandactsmuchlikearouterontheInternet,automaticallydiscoveringneighboring

accesspointsandrelayingpacketsacrossseveralwirelesshobs.Withthisstrategythe

ownershipofaccessnetworkbecomesdistributedacrossthehouseholds.Suchdecentralized

networkarchitecture,notonlyprovidesadegreeofautonomy,butitalsosubstantiallyreduces

thecoststhroughsharedresourcesandservices.21

20See18

21Someemergingwirelessbroadbandtechnologieshaverealizedtheefficienciesoftheorderof10b/s/Hz,and

unprecedentedlevelsofindividualandaggregatecapacitiesintheorderofGb/swirelessdatarates.

15


16/41

Inrecentyearsbroadbandoverpowerlines(BPL)hasemergedasathirdoptiontoservice

providers.QualityofserviceinBPLdegradesduetopresenceofnoiseandtransientsin60Hz

powerlineswhichinturnwilllimitthebandwidthduetouseofmultiplerepeaters.However,

BPLoffersadvantagestoreductionincostsinruralareas.BPLcaninparticularserveasan

attractiveoptioninareaswherethepopulationdensityislower.Presenceoftransformers

significantlyinhibitstheBPL.However,lessdenselypopulatedareasrequirelessnumberof

transformerswhichinturnputstheminadvantagewhiletransferringbroadbandsignalsover

powerlines22.

22EisensteinB.,MarcusM.,SopenskyE.,ThomasD.,TeleconferenceonRoleofR&DinExpansionofBroadband

Services, July24,2009.

16


17/41

3. WhyUniversalBroadbandMatters?3.1 BroadbandandRuralDevelopment

As

technology

advances

and

new

applications

emerge,

the

ability

for

broadband

to

influence

theeconomyexpands.Whileinvestmentsinbroadbandinfrastructuresandservicesdirectly

impacteconomy,factorsdrivinggrowthsuchasinnovation,firmefficiency,competitionand

globalizationofferindirectimpacts.23

A2003studyconductedbyCriterionEconomicsfoundthat$63.6billioninvestmentsin

broadbandtechnologieswilldirectlyimpacteconomicgrowthby$179.9billionincreaseinGDP

andcreationof116,000.Thestudyalsoprojectedthat1.2millionjobscanbecreatedasa

resultofnextgenerationbroadbanddeployment.24

GDPisanindicatorofcountrysdegreeofprosperityanddevelopment.25Asthegovernment

spendingintheUnitedStatesdropsandconsumptionratesflatten,grossinvestmentsand

exportrelatedactivitiesremaintheonlywaytoexpandtheeconomy.Communication

technologiesholdpromisestoruralrevival,sincethosecancreatetherequiredplatformsfor

newinvestmentsinvarioussectorsincludingthefinancialmarket.Broadbandexpansionwill

encouragelargebanksandfinancialinstitutionstobecomeasourceofcompetitionbymaking

iteconomictooffertheirservicestoruralcommunities.Competitiveinterestratesandmore

financial

activities

are

among

direct

consequences

of

broadband

penetration

in

rural

areas.

23RobertD.Atkinson,FramingaNationalBroadbandPolicy,CommLawConspectusat4(Fall2007),

http://tinyurl.com/2htbwo(AtkinsonFramingReport).24

RobertCrandall;theeffectofubiquitousbroadbandadoptiononinvestments,jobs,andtheUSeconomy,

conductedbyCriterionEconomy.25

GDPcomprisesofconsumption,governmentspending,grossinvestment,exportandimport.

17
http://tinyurl.com/2htbwohttp://tinyurl.com/2htbwo


18/41

Morespecifically,broadbandenormouslyimpactsruralbusinesses.

Ruralcommunitiesareoftendependentonagriculture.Inpresenceofnetworkinfrastructures

small,

regional

farms

can

form

strong,

national

partnership

that

helps

them

to

supply

their

productswithnoneedformiddlemen.Buildingontheagriculturaltraditionof

entrepreneurshipbyformingregionalpartnershipsandpromotingbusinessformationisthe

keytothefutureofmanyruralcommunities.26

Furthermore,21stcenturyagricultureishighlydependentonnew,digitizedtechnologiesto

meet

adequate

degrees

of

efficiency

and

productivity.

For

example,

farmers

rely

on

technology

toobtainaccuratemeasureandcontrolovertheamountofmineralsinthesoil.27

Theyalsorely

ontheInternettoforecastweatherconditions,markettheirproductsandfindhighqualityand

cheapsupplies.

Broadbandisalsoimportanttononfarmindustries.Businesspeopleand,inparticular,

entrepreneursviewtheservicesasanecessitytothefutureoftheiractivitiesandwillinvest

theirresourcesinareaswheretheycanconductbusinessonline.Communicationtechnologies

havecontributedtoanewcultureinwhichselfgenerationandaccesstoglobalmarkets

substituteforscarcityinlocalresources.AsAtkinsoncallsit,ahostofdigitaltoolsareenabling

consumerstobecome,inthewordsoffuturistAlvinToffler,proconsumer,thosewho

26FederalReserveBankofChicago,TheFutureofEconomicDevelopmentinRuralAmerica,July2006,

27Accordingtothedepartmentofagriculture2007Censusthehighestpercentageofruralbroadbandconnections

areconcentratedinregionswithlargefarmsandranches.Thestudyalsofoundthatfarmsinruralareasareless

likelytoutilizebroadbandconnectionsincomparisontothoseclosetourbanandmetroregions.Accordingto

thesedata,farmsbroadbandadoptionhasincreasedfrom50percentin2002to56.5percentin2007.Thereisalso

alargedifferencebetweenbroadbandpenetrationtofarmsbyregions.Thewestleadsinbroadbandconnections

andthesouthlagsbehind.Fordetailedstudyofbroadbandpenetrationinfarms;seeBroadbandConnection

HighsandLowsAcrossRuralAmerica,availableathttp://www.dailyyonder.com/broadbandconnectionhighs

andlowsacrossruralamerica/2009/02/11/1921

18
http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921http://www.dailyyonder.com/broadband-connection-highs-and-lows-across-rural-america/2009/02/11/1921


19/41

simultaneouslyactasbothproducerandconsumer.28Accesstobroadbandwillenablelow

startupcost,innovativeideasinruralregionstobeturnedintoviablecompanies.Internet

marketing,asectorthatgrewrapidlyonpromiseofInternetcanbemanagedfromanyrural

home.AsIMS,anInternetmarketingcompany,asserts:

Youwillhavebusinessfreedom,becauseyouwillbeabletosetyourownhoursand

ultimatelydecidewhethertoworkfulltimeorparttime.Youalsohavethechoiceto

workfromanoffice,orfromtheconvenienceofyourownhome.Furthermore,youcan

alsoachievepersonalfreedom.IMSFranchiseessimplyestablishclientrelationshipsand

performconsulting,whilewecompletetheactualtechnicalwork.Thistranslatesinto

moretimeforyoutodoanythingyoupleaseonapersonallevel.IMScanhelpyou

establishpersonalfreedomandthelifestyleyouwant,foryourselfandforyourfamily.29

Anationwidebroadbandcanevenimpactruralmanufacturers.Flexiblemanufacturingand

smalleroptimalsizesofplantswillgiveruralbusinessacompetitiveadvantageagainsttheir

gianturbanandsuburbancompetitors.Inpresenceofdigitizedinfrastructuresandservices,

smallfirmsandbusinesscanmovetheirfacilitiestoregionswithlowercostsandcanutilize

theirsavingsinprovidingbetterservicessuchasfundingmoreprojects,andofferingquality

healthcaretotheiremployees.

3.2 BroadbandandItsPotentialImpacts

Inadditiontoeconomicgrowth,thereareotherexternalitiesinbroadbanddeployment.30

Expansion

of

broadband

introduces

new

possibilities

to

rural

communities.

In

recent

years,

28http://commlaw.cua.edu/articles/v16/16.1/Atkinson.pdf,p.12

29http://www.entrepreneur.com/businessopportunities/imsInternetmarketingspecialists/197887.html

30Atkinson,RobertD.(2007).FramingaNationalBroadbandPolicy.CommlawConspectus(16:145177).At

http://commlaw.cua.edu//articles/v16/16.1/Atkinson.pdf

19
http://commlaw.cua.edu/articles/v16/16.1/Atkinson.pdfhttp://commlaw.cua.edu//articles/v16/16.1/Atkinson.pdfhttp://commlaw.cua.edu//articles/v16/16.1/Atkinson.pdfhttp://commlaw.cua.edu/articles/v16/16.1/Atkinson.pdf


20/41

ruralandexurbanareashavefacedadrasticoutmigrationoftheiryoungworkforce.Lackof

balancedgrowthstrategieshascontributedtochangeintheproportionofpeoplelivingin

metroversusnonmetroareas,whichinturnhascausedincreasesincosts,pricesandpollution

inurbanregions.Broadbandpromisessomechangestothistrend:

BroadbandEnsuresthatStudentsRemainConnectedBroadbandkeepsstudentsconnectedintheglobal,digitized,andknowledgebased

economy.Throughonlinetoolsandcoursesstudentsofanyagecanexperiencequality

educationatconvenienceoftheirhomes,atreducedcosts.Onlinelearninghas

promisestoimprovetheoverallstateofliteracyintheUnitedStates.

BroadbandofferstheUnitedStatesMoreOpportunitiestoCompeteinGlobalMarketTwentiethcenturyeconomicstrategiesopenedthedoorsforthecreationand

importationofnewjobs,industriesandresearchanddevelopments(R&D)totheUnited

Statesbyallowingmarketbasedmechanismstodrivetheeconomy.Today,market

drivenforcesleadcompaniestooffshorescience,technology,engineering,and

mathematics(STEM)jobstolowcostcountries.WhileChinaandIndiaexcelinIT

industry,thelackofdrivingmechanism(suchasjobs,education,interestinSTEM

careers,lowR&Dtaxcreditsincomparisonwithotherdevelopednations)continueto

causeadramaticdeclineindemandforITrelatedactivitiesintheUnitedStates.

Broadband

can

change

this

trend

by

creating

economic

development

strategies

to

attractprivatesectorinvestmentsandattractnew,highskilledSTEMjobsinmorecities,

townsandruralareas.Somecompanieshavealreadystartedrethinkingtheirglobal

strategiesbylookingintopotentialU.S.locations,especiallymidsizemetropolitanand

20


21/41

ruralareas,forlowcostdomestic(LCD)sourcingthatcanprovidemorethan30percent

costsavingsovertheIThubssuchasSiliconValley.31

Governmententities,semi

regulatedindustriesandcompaniesthatareconcernedaboutsecurityandprivacywill

mostwelcomedomesticsourcinginruralareas.Smallandmidsizecompanies,thatare

limitedbyscaleandmanagement,aremoreinclinedtochoosedomesticsourcing.

Moreover,studiesdemonstratethatsmallsizecompanieshavebeenmoreactively

involvedwithR&DinUnitedStatesthantheirgiantcounterpartsandtheirpresencein

ruralareaswillpositivelycontributetojobcreationandinnovation,factorsthatcanhelp

inglobalcompetency.

CreationofaDynamicWorkEnvironmentBroadbandcancreateamoredynamicworkplacewhichinturnincreasesbusiness

efficiencyandproductivity.Employeeswouldbeabletoaccesstheirfileand

informationanywhere,anytime.Broadbandalsobenefitsathomeentrepreneurssuch

asDomainNameBrokers,EBargainers,andEcommerceconsultants.Withthe

enterprisemarketleaningheavilytowardentrepreneurialefforts,SmallandMedium

Enterprise(SME)willbelocatedinresidencesandresidentialneighborhoods.

Inadditiontothefactorsdiscussedabove,expansionofhighspeedInternetaccesssupports

newgrowthsectorssuchasmedicine,energy,andcleantechnology:32

31ConscientPartners,LLC,LowerCostDomesticSourcing:ANicheOpportunityforUS,July2007,availableat

http://www.itaa.org/upload/news/docs/DS_ExecSum_Final.pdf.32

Lennett,BenjaminandMeinrath,Sascha.(2009,January)Buildinga21stCenturyBroadbandSuperhighway:A

ConcreteBuildoutPlantoBringHighSpeedFibertoEveryCommunityWashington:NewAmericaFoundation.At

http://www.newamerica.net/publications/policy/building_21st_century_broadband_superhighway.

21
http://www.itaa.org/upload/news/docs/DS_ExecSum_Final.pdfhttp://www.newamerica.net/publications/policy/building_21st_century_broadband_superhighwayhttp://www.newamerica.net/publications/policy/building_21st_century_broadband_superhighwayhttp://www.itaa.org/upload/news/docs/DS_ExecSum_Final.pdf


22/41

HighSpeedInternetEnablesHealthIT(HIT)managementMovingfrompaperfilestoonlineelectronicrecordsmakesphysicianpatientand

physicianphysiciancommunicationseasier.HITcaninparticularbehelpfultorural

residentssinceitreducestheircommutetoadoctorsoffice.HITalsopreservesthe

medicalrecordsagainstnaturaldisasters.Forinstance,duringthehurricaneKatrinaa

considerablenumberofpatientslosttheirmedicalrecords.

Moreover,giventhat80percentofthose65andolderlivewithatleastonechronic

disease,andconsideringthat90percentofnursinghousesareunderstaffed,amore

efficienthealthcaremanagementisneeded.HIT,whenbroadlyimplementedon

promiseofubiquitousbroadband,directlybenefits80percentofourseniorcitizensby

allowingforearlydiagnosisoftheirdiseases.

Wirelessmedicineisexpectedtohelp5millionpatientswithAlzheimersbyconstant

monitoringofvitalsigns,activities,locationandbalance),20millionwithasthma(by

trackingtherelativerisk,airquality,oximetry,andpollencontent)and21millionwith

diabetes.33

BroadbandisacontributortoamoreenergyefficientfutureSoon,installingsmartpowermetersinU.S.householdswillallowhomeownersto

monitorandreducetheirelectricityconsumption,whichinturnhelpstoachieveenergy

savings.

Oneofthewayswiringourhomesandofficespromiseslargeeconomicpayoffs,

alongwithimmenseenvironmentalbenefits,isbyallowinginteractive

monitoringofandmoreefficientenergyuse.Bycreatingsmartbuildingstied

33Pleaserefertotheindexforlistofdiseasesthataretargetedwithwirelessmedicine.

22


23/41

tothelocalpowergrid,asa2002DepartmentofEnergyreporthighlighted,

utilitycompanieswonthavetokeepasmuchwastedreservepoweronhand,

leadingtolowerpricesandlesspricevolatilitywhichwillcreateamore

resilientelectricgridthatismorerobustandsecureagainstbrownouts,

blackouts,andhostileattacks thelatterespeciallyattractiveinthewakeofthe

2003blackoutofmuchoftheNortheastandCanada.34

4. FactorsAffectingBroadbandAdoptionUnderserveddefinitionemphasizestheadoptionrateasanimportantcriterionindisbursement

ofavailablefunds.Assessmentofissuespertainingtobroadbandadoptionisonlypossibleby

studyanddevelopmentoftechnologyadoptionmodels.Increaseinhouseholdadoptioncan

createtherequiredmarketdriversforexpansionoftechnologyintoruralareas.

Householddiffersfromworkplaceonanumberofdimensions,suchasthecomplexityof

interactionsandnegotiationsamonghouseholdmembers,differencesintypesoftasks

andtheintricaciesinherentinthevariousstagesofhouseholdlife.Further,since

technologyisembeddedinacontextandthecontextisanimportantaspectof

understandingthetechnologyanditsuse,thehouseholdcontext,givenitstremendous

growthasatargetforimplementationoftechnologies,isanimportantaspectof

theorizingabouttechnology.35

DespiteadocumentedrapidgrowthinbroadbandadoptionintheUnitedStates,animbalance

stillexistsamongdifferentsegmentsoftheAmericanpublic.LarryIrving,aformerUnited

StatesheadofNTIAandtechnologyadvisertotheClintonadministrationnotesthisparadoxas

earlyas1995andtermsitasthedigitaldivide.Thedigitaldividecomprisesoftwofacets

unequal

access

to

technology

and

unequal

ability

or

desire

to

make

use

of

technologies.

36

34ProgressiveStatesNetwork,BroadbandforEconomicGrowthandEnergySavings:SmartBuildings,Energy

savings(undated),http://tinyurl.com/29ngjy.35

BrownSusan,ModelofAdoptionofTechnologyInHouseholds:ABaselineModelTestAndExtension

IncorporatingHouseholdLifeCycle,MISQuarterlyVol.29No.3,pp.33942636

USIIA,DeploymentofBroadbandtoRuralAmerica,03/04/2008

23
http://tinyurl.com/29ngjyhttp://tinyurl.com/29ngjy


24/41

Conductedsurveyssuggestthatthefollowingfactorsimpacthouseholddecisionstoadopt

broadband:

1) ConsumerFactors

a. Income:Surveyssuggestthathouseholdincomeandbroadbandadoptionare

linearlyrelated.In2008,88percentofhighincomehouseholds householdwith

incomeexceeding$100,000 utilizedbroadbandconnections.Incontrast,only41

percentoflowincomehouseholds withannualincomeof$25,000andless had

adoptedthetechnology.Whilebroadbandadoptionamonghighincomehouseholds

isapproachingitspointofsaturation,thereisalargelowincomepopulation

(significantlyoverrepresentedinruralareas)thathasyettoadoptthetechnology.

b. AgeandLifeCycle:Homebroadbandadoptionisininverserelationtoincreasesin

age.In2008,84percentof:GenY(i.e.,householdswiththeageoftheheadin18

24)and81percentofGenXhouseholds(i.e.,2544)hadadoptedthetechnology,

whileonly43percentofseniors(65+)hadaccesstobroadbandathome.Out

migrationofyoungerworkforcehasconsiderablyincreasedaverageageofrural

America.

c. Price:Highbroadbandpricesarethemostaffectivefactoragainstincreasesin

adoption.Associetyadvancesandtechnologyevolves,broadbandpricestendto

followapattern.Declineinbroadbandpricesononehandandincreaseinpricesfor

24


25/41

dialupservicesinpastyearshascontributedtomoreadoptiontothetechnology.

Broadbandpenetrationexhibiteda17percentgrowthfromApril2007to2008.37

Figure3.U.S.annualgrowthinhomebroadbandadoption

Figure4.Increaseinbroadbandadoptionvs.dialup38

37AccordingtothePewInternet&AmericanLifeProjectsurveysof2008broadbandusersreportedanaverage

monthlybillof$34.50inApril2008,$1.5downfromthatinDecember2005.Thisis4percentdeclineinathree

yearsspan.Bycontrast,thedialupservicesfaceda9percentincreasefrom$18to19.7$amonthinthesimilar

timeframe.38

Pewinternationalavailableatwww.pewInternet.org/~/media//Files/Reports/2008/PIP_Broadband_2008.pdf.

25
http://www.pewinternet.org/~/media//Files/Reports/2008/PIP_Broadband_2008.pdfhttp://www.pewinternet.org/~/media//Files/Reports/2008/PIP_Broadband_2008.pdf


26/41

2) TechnologyandProvider

a. AccesstoBackboneInfrastructures:Mostruralandexurbanareasarelocated

within70to200milesfromthebackboneinfrastructures.Middlemilelines

requiremassiveamountofinvestmentandareconsideredtobeimportant

contributingfactorinbothcostsforserviceprovidersandpricesforconsumers.

Thus,eveninbestcasescenario,whentwoareasareatanidenticalpopulation

density,theserviceswillbemoreexpensiveaswemovefartherfrombackbone.

Theproblemwithaccesstobackboneisanothercontributortouneconomicrural

broadband.

b. PolicyandRegulations:Policymakerscanplayimportantroleinexpansionof

technologiesbyeitherfundingbasicresearchorbypassinglawsthataddressthe

needsfortechnologicalgrowth.Duetostrongpresenceofentrepreneursand

R&DsectorsintheUnitedStates,policiescandramaticallyinfluencereforms.For

instance,lawssuchasTheElectrificationActof1934orTheTelecommunicationsActof1996bothhadenormousimpactinexpansionandgrowthoftechnologiesbyattractingprivateinvestments.Similarly,andasacounterexample,both

underutilizationofspectrumandlackofspectrummanagementpolicies,haveled

tolimitedinvestmentincommercializationofsmarttransceiversinrecentyears.

Policiesthatencouragecompetitionorincreaseindemand,canpositivelyimpact

broadbandadoptionbyeitherreducingthepricesorattractingmorefundsin

growingsectors.

26


27/41

5. WhatistheSolution:PolicyRecommendationsThefollowingsectionfocusesonpoliciesthatcanhelpmakemoreaffordablebroadband

servicesavailable.Recommendationsondatacollectionandtechnologydevelopmentsapplyto

bothurbanandruralAmerica;demandincreasepoliciesapplymoretoruralareas.

DataCollection:

Asolutiontothecurrentbarrieragainstthebroadbandadoptionandavailabilitywillnotbe

possibleunlessthereisacomprehensive,universalbroadbandmapavailabletotheFCC.

VirginiaTechseCorridors39hasproventobeaneffectiveapproachinpreparingabroadband

mapinashorttimeperiod.TheFCCshouldsetupanewwebsiteformonitoringbroadband

adoptionandspeedbycollectingandanalyzingdatafromonlinesurveys.TheFCCshouldmake

severalpublicannouncementsinlocalradio,TVandnewspaperstoinformthepublicaboutits

mission.Eachtimeausercarriesthespeedtest,theirlocationwillberecordedonthemap.

Usingthisapproach,thefederalgovernmentacquiresacomplete,precisebroadband

penetrationmapinashorttime.

Technology:

SpectrumManagement

Availabilityofspectrumisvitaltoexistenceofwirelessbroadband.TheFCCshouldmakemore

spectrumavailableforsharing.Itshouldalsodevelopregulatorypoliciestoensureefficientuse

ofavailablespectrum.

39VirginiaTechstartedaprogram,eCorridor,toenhancedataavailabilityonstatewidebroadbandconnections,

availableathttp://www.ecorridors.vt.edu/

27
http://www.ecorridors.vt.edu/http://www.ecorridors.vt.edu/


28/41

Thespectrumshouldbequasilicensedwithregulatoryfeesfromprimarylicenseholdertothe

secondaryusers.40

TheFCCshouldgrantprimarylicensesbyasealedfirstpriceauction.Sealed

firstpriceauctionensuresthatlicensesgotothebidderthatgainsthemostadvantagesfrom

auctionedspectrum.

Research&Development

Broadbandisnotthesolutiontoonebigproblem,itisapartialsolutiontomanyproblems.

IncentivesthatfacilitateleverageofbroadbandinfrastructuresforInternetbasedapplications

canpositivelyimproveuniversalexpansionofservices.R&Dtaxcreditscanplayanimportant

roleinensuringthattheUnitedStatesremainsattractivetoglobalcompanies.Providingmore

generousR&DfinancialincentivescanbetheUnitedStatesmosteffectivestrategytocompete

withtheotherdevelopednationsincludingCanada,SpainandFrance.41Asof2004,theUnited

StatesrankinR&Dtaxcreditgenerositywas17th

amongOECDnations.42

AllowingourR&Dto

moveoffshoreduetopoortaxcreditswillhaveseriousconsequencestofutureofinnovationin

theUnitedStates.

Congressshouldprovide50percenttaxcreditsinunderservedand100percenttaxcreditsin

unservedregionsfordevelopinglastmileinfrastructuresinruralareasinthenext10yearsor

bythetimetheymeetthebroadbanddefinitionfromsection2,whicheverissooner.

40Refertotheappendixfordiscussionondifferentspectrummanagementpolicies.

41Atkinson,TheResearchandExperimentationTaxCredit:ACriticalPolicyToolforBoostingResearchand

EnhancingU.S.EconomicCompetitiveness,September4,2006,availableat

http://www.itif.org/files/R&DTaxCredit.pdf.42

JacekWarda,TaxTreatmentofInvestmentinIntellectualAssets:AnInternationalComparison,

OECDScience,TechnologyandIndustryWorkingPapers4(Paris:OECD,2006).28
http://www.itif.org/files/R&DTaxCredit.pdfhttp://www.itif.org/files/R&DTaxCredit.pdf


29/41

Congressshouldalsoeliminatetaxesinresearchanddevelopmentsforcompaniesthatinvestin

wirelessdevicesandnetworkdesignsinruralareas.

Supply:

Broadbandisaninfrastructure.Althoughinfrastructurecompaniesareoftenmonopoliesand

usuallyhavemarketpower,themostimportantchallengeininfrastructurepolicyis,

paradoxically,notpreventingcompaniesfromchargingmorethancosts,butratherensuring

themthattheywillbeallowedtorecovertheircosts.Asdiscussedinsectionthree,middlemile

infrastructures

are

vital

to

expansion

of

broadband

services

to

rural

areas.

This

section

proposespoliciesthatwillreducecostsby1)partnershipbetweenprivatecompaniesand

governmentagencies;and2)promotingcompetitioninmiddlemileinfrastructures.

Middlemileinfrastructuresareessentialtothesuccessofbroadbandprojects.Giventhe

limitedgovernmentfunding,solutiontolackofmiddlemileinfrastructureshouldcomeintwo

phases:

PreparearuralbroadbanddevelopmentmapTheappropriatedfundsarenotadequatetoeliminatetheneedformiddlemileinfrastructures

inasinglephaseeverywhereintheUnitedStates.Thus,RUSandNTIAshouldprioritizeas

wheretoextendinfrastructuresfirst.Agenciesshouldformacommitteetoundertake

feasibilitystudiesthatconsidertheemergingmarketforces,potentialfuturerural

developmentsandtheirneedforhighspeedInternetinthenextdecade.Thecommittee

shouldidentifyobjectivesinexpansionofbroadbandservices,anddefinecriteriaandneedin

addressingthoseobjectives.Forinstance,ifthegoalisdevelopmentofhighspeedapplications

29


30/41

suchasanationwidehealthITnetwork,43priorityshouldbegiventoprojectsthatcovermore

populationthanlandmasswithadequatespeed;whereas,ifthegoalisnationwideavailability

ofbasicservices,higherspeedshouldbesacrificedformoreaccess.

Upondefiningthegoals,thecommitteeshoulddividethemiddlemileprojectsintwo

categories:1)fiberbased;and2)wireless.

Expensive,highcapacityfiberlinksshouldconnectbackbonestothedevelopingruralregions

withpotentialforextensiveeconomicgrowth.

Fiberlinkscannotsupplyareasthatfacerapiddeclineinpopulation.Provisioninthoseareas

shouldtakeplacebywirelesstechnologies.Commissionshouldallocate20percentofmiddle

milemoneytowirelessprojects.Accesstospectrumisanotherconcerntosuccessofwireless

middlemiles.FCCshouldallocatespectrumin700MHzrange,previouslyusedforanalogTV,

forexclusivemiddlemilebroadbanduse.Lowertheoperatingfrequency,longerthewireless

signaltravels.

Improvethemiddlemileinfrastructures,throughcooperationwiththeDepartmentofTransportation

Majormiddlemilenetworksindevelopingruralareasshouldbeconstructedusingfiberoptic

links.Recentstudiesfoundthatmorethan60percentofthecostinimplementingfiberlinkis

duetodiggingfiberintoground.Withthe2009Omnibustransportationbillinplace,the

countrystransportationinfrastructureswillgothroughaseriesofmaintenance,expansion,and

improvementsinthenextfiveyears.TheHighwayActprovidesmiddlemileprovidersaunique

43Refertotheappendixforinformationonbandwidthrequirementsfordifferentapplications.

30


31/41

opportunitytolayhighcapacity,fiberlinksalongallfederalhighways.Thenationalhighway

systemcomprisesof163,000milesofroadwaywith90percentofU.S.populationlivingwithin

5milesoftheseroads.44Sharingresourceshelpscompaniestoreducethecostoftheirfiber

links.CollaborationwiththeDepartmentofTransportationiskeytoincreasedmiddlemile

coverage.NTIAandRUSshouldutilizetheproposedfeasibilitystudy(above)toidentifythe

targetfiberpathways.Afterdecidingonareasfordevelopment,agenciesshouldsigncontracts

withtheDepartmentofTransportationtoimplementaccessiblepipesforaccommodatingfiber

bundlesunderhighwaysastheyrenewtheroads.

Existenceofpipelineswillenablegradualupgradeandexpansionofmiddlemilenetworks.

Whilefiberbundlesforareaswithhigherprioritycanberunthroughthepipesastheyare

beingconstructed,areaswithlessprioritycanbedevelopedovertimeandasmorefunds

becomeavailable.

Figure5belowdemonstrateshowcollaborationwiththeDepartmentofTransportationcan

extendnetworkstothemostremotecornersoftheUnitedStates.

44Lennett,BenjaminandMeinrath,Sascha.(2009,January)Buildinga21stCenturyBroadbandSuperhighway:A

ConcreteBuildoutPlantoBringHighSpeedFibertoEveryCommunity

Washington:NewAmericaFoundation.At

http://www.newamerica.net/publications/policy/building_21st_century_broadband_superhighway.

31
http://www.newamerica.net/publications/policy/building_21st_century_broadband_superhighwayhttp://www.newamerica.net/publications/policy/building_21st_century_broadband_superhighway


32/41

Figure5.ComparisonofU.S.populationdensityandU.S.nationalhighwaysystem

Adoption:

Broadbandadoptionisdrivenbyincreaseinneedandmarketforces.Publiceducationcreates

therequiredmarketdriverswhichinturnattractlocalproviderstofacilitatehigherqualityof

servicesatreducedcosts.

BridgetheGaptoDigitalIlliteracyo FundSchoolsandcomeupwithincentivestoprovidechildrenwithcomputers

atschoolsThissectionfocusesonasmall,yetimportantsegmentofU.S.householdswithchildrenat

home.AsmentionedinSection5factorssuchasincome,age,generaleducation,priceand

accesstocomputerimpactbroadbandadoptionbyhomeowners.Whilethesefactorsdiffer

largelyinscope,theyallareconsequencesofacommondriver,need.Schoolgoingchildren

influencehouseholddecisionmakingprocess.ChildrenoftodayrelyonInternetapplications

suchasEmail,onlinelearning,andeducationaltoolstoexcel.

Educativeprogramsplayimportantroleinincreasingdemand.Congressshouldmakemore

fundsavailableforpubliclibraries,andpublicschoolstoadoptcomputers.

32


33/41

CongressshouldfundtheLibraryofCongresstodigitizealargernumberofitsprintcapacity.

ThereshouldbeasimilarfundingfortheSmithsonianmuseumstooffervirtualtours.Such

programsprovideschoolteachersindisadvantagedareaswithhandfulofresourcestoeducate

children,whileboostingdemandformoreInternetpenetration.

o ExtendtheLifelongLearningTaxCredittoCoverAccesstoBroadband:45Congressshouldadoptpoliciesthattargetadultstudents.Educationisoneofthekeysectors

thatcanbenefitfromhighspeedInternet.ThoughhighInternetpricesremaintobeanobstacle

againstInternettakeup,policiesthataregearedtowardsdistancelearningcanboostadoption.

Governmentshouldprovidetaxcredittocoveraccesstobroadbandforstudentswho

participateinonlinecoursesthatqualifyforcollegelevelcredits.

45Atkinson,etal.UnleashingthePotentialoftheHighSpeedInternet,September2002,at

http://www.ppionline.org/documents/Broadband_0902.pdf,p.28.

33
http://www.ppionline.org/documents/Broadband_0902.pdfhttp://www.ppionline.org/documents/Broadband_0902.pdf


34/41

6.Appendixi. NeedforSpectrumManagementInrecentyears,wireless,duetoitslowimplementationcostandflexibilityincoverage,has

attractedalotofattentionsamongexperts.Thoughcomplementarytotheexistingbroadband

technologies,wirelessinruralandremoteareascanbeviewedastheonlyeconomicoption

available.Scarcityinfrequencybandshasmadespectrum46managementacrucialpartof

communications.Onceafrequencybandbecomesavailable,therearethreemajoroptionsin

useofspectrum:47

1) Thesimplestapproachforgovernmentistosplitandlicensetheavailablespectruminto

smallernonoverlappingfrequencybands.Licensesthenaresoldamongindividual

companieswhoaregivenexclusiverightstoutilizetheirlicensedband.Government

licensingreducesneedforcoordinationtoalargeextent.Incontrast,itisspectrally

inefficientsincethereisapotentialforbandtoremainunusedforalongperiodoftime.

Licensedbandcomprisesover95percentofpublicairwaves.48

2) Second,isuseofunlicensedspectrumwhereanydeviceisallowedtooperate.

Unlicensedbandsrequireregulatoryprotocolstoavoidmutualinterference49

between

devices.Inadditiontoenablingcommunicationsbetweenlowpowerdevices,this

46Spectrumistherangeoffrequenciesoverwhichwirelesstransmissiontakesplace

47PehaJon,SpectrumManagementPolicyOptions,1998,availableat

http://www.comsoc.org/livepubs/surveys/public/4q98issue/pdf/Peha.pdf.48

NewAmericaFoundation,TheCitizensGuidetotheAirwaves:AgraphicdepictionoftheUse andmisuse of

theradiofrequencyspectrum,2003.49

Inwirelesscommunications,unlikewiredcommunications,thereisnoexactpathforthesignaltransmission.

Wirelessdevicestransmitdataoverfrequencybandsinagivengeographicalregion.Interferenceoccurswhentwo

devicestransmitsignalsoverthesamechannel(i.e.frequencyband),inasameregionatthesametime.

34
http://www.comsoc.org/livepubs/surveys/public/4q98issue/pdf/Peha.pdfhttp://www.comsoc.org/livepubs/surveys/public/4q98issue/pdf/Peha.pdf


35/41

approachallowsspectrumsharingbetweenusers.Shareofunlicensedspectrumwill

increasespectralefficiencybyminimizingtheidletimeofagivenband.Inthetimeone

deviceisnotoperating,otherscanutilizethespectrumtotransmittheirdata.Theother

advantagetounlicensedspectrumiseliminationofhightransactioncostsinlicense

allocation.Unlicensedusewillalsospurcreativityandinnovation.Manyapplications

suchascordlessphonesandWiFiuseunlicensedspectrum.Thoughappealing,there

arecertaincriticismstoabundanceofunlicensedbands.Duetothelackofmarket

forcesindrivingusage,thisschemecanleadtooccupationofvaluablefrequencybands

bylessusefulapplications.

3) Finally,adynamicspectrumsharing(DSS)schemeproposedbyTheSpectrumPolicy

TaskForces(SPTF)UnlicensedDevicesandExperimentalLicensesWorkingGroupcan

supportincreaseddemandtowirelesscommunications.DSS,acombinationoflicensed

andunlicenseduse,allowstheprimarylicenseholderstosharetheirspectrumwith

unlicenseddevices,whileidle.Inanidealcasetherecanbeanagreementbetween

primarylicenseholderandsecondaryusersonprices.Thisononehandwillgivelicense

holdersincentivestoallowtheirspectrumtobeusedbyunlicenseddevices,andonthe

otherhandwillensuremoreusefulapplicationsbyshiftingthecontroloverapplications

fromgovernmentscentralplanningtoafreemarketbasedutilization.

In

2002,

John

Williams

of

FCC

documented

a

complete

accounting

of

spectrum

available

in

300

to3000MHzrange.Traditionally,mostspectrumusewaseither,broadcasting,asimplex

service,orfullduplexrealtimecommunications.50However,theemergingspectrumusageis

50MikeMarcus,NewApproachestoPrivateSectorSharingofFederalGovernmentSpectrum

35


36/41

basedonpacketizedinformationtrafficflow.51Thisschemeishighlyfavoredduetoits

promisestoapplicationssuchasmobileInternetandwirelessAudioVideotransmissions.

Spectrummanagementpoliciesarenecessaryinprovidingtheappropriatebasisforfuture

wirelesscommunications.Currently,aconsiderableportionofthesespectrumsare

underutilized.AstudybyMcHenryfoundthattheaveragetotalspectrumuseinsixlocations

alongtheeastcoasthasbeenlessthan10percentin2004.StudyinNewYorkwasdoneduring

the2004nationalconventionandaccountedforonly13.1percentuseoftotalspectrum

available.52

Keytofutureapplicationsliesintransitionfromconventionalpassivespectrumutility,toa

moreactive,dynamicusethatcanminimizetheidlespectrum.Sharingparticularly,have

promisesinimprovingtheefficiencyoftheavailablespectrums.Byemployingappropriate

spectrummanagementschemes,itispossibletosignificantlyimprovequalityofwireless

technologies.Thefuturesystems,shouldworkincollaborationtosupportthehighspeed

applications.Policiesthatenhanceandregulatecooperationbetweenprimaryandsecondary

systemsshouldbewelcomemore.

Category Fraction

FederalGovernment 22.4percent

Non FederalGovernment 34.7percent

Shared 34.7percent

InTransitionfromFederaltoNon

Federal

2.5percent

UnlicensedandManagedbyFCC 5.6percent

Table3.Compositionofspectrumavailability53

51See31.

52McHenry,Mark(2004).SpectrumOccupancyMeasurements,availableat

www.sharedspectrum.com/measurements/ .53

Source:FCCWilliams,TakenfromMarcusPaperatwww.sharedspectrum.com/measurements/.

36
http://www.sharedspectrum.com/measurements/http://www.sharedspectrum.com/measurements/http://www.sharedspectrum.com/measurements/http://www.sharedspectrum.com/measurements/


37/41

ii. AvailableMiddleMileOptionsThenextgenerationsofresidentialandbusinessapplicationsfaceeverincreasingneedfor

more

bandwidth.

Applications

such

as

HDTV

will

require

up

to

20

Mbps

per

TV

set.

Need

for

higherspeedandscarcityinbandwidthhasforcedbackboneproviderstoexaminealternatives

solutionssuchasfiberopticlinks,wirelesslinksandBroadbandoverPowerLine(BPL),and

satellitelinks.

OpticalFibersOpticallinksofferalmostunlimitedamountofbandwidthandspeed.Fibersareconsideredas

thebestchoiceforbackboneinfrastructuresinareaswherethereisamassiveamountofspeed

required.Prohibitivelyhighdeploymentcost,limitsubiquitoususeoffiberlinks.

Wireless

Wireless

signals

utilize

the

radio

frequencies

to

transmit

the

data

over

the

air.

The

physics

of

electromagneticfrequencyputstwoconstraintsonthetransmission.Thehigherthefrequency

is,thehigherthedatarateandhencethebandwidthwillbe.Ontheotherhand,increasein

frequencyisaccompaniedwithdegradationinrangeandpenetration.Forexample,a700MHz

signaltravelsandpenetratesfartherthana2.4GHzcounterpart.Onethingthatcanintroduce

changestotheserulesispower.FCCclassifiestheradiospectruminlicensedandunlicensed

bands.Devicescantransmitatmuchhigherpowerinlicensedfrequencywhichallowsthemto

penetratefurther.Forinstance,WiFienableddevices,microwaveovenandcordlessphonesall

37


38/41

operateinunlicensed2.4GHzband,whiletheconventionalanalogTVusedtotransmitinthe

700MHzwhichislicensed.

Technology

can

also

impact

data

rate.

Many

wireless

backbone

solutions

utilize

unlicensed

60

GHzandlicensed80GHzbandstooperate.60GHzbandiscapableoftransmittingupto1Gbps

ofdatafor3Km,while80GHzbandspotentiallycantransmitupto10Gbpsfor5Km.

WirelessbackbonescanbedeployedbyeitherusingPointtoMultiPointaccessmodel(PTMP)

orPointtoPoint(PTP)directmicrowavelink.ThePTMPmodelisbestsuitedforlower

frequency

bands

and

can

easily

be

implemented

in

rural

areas

where

distances

are

significant

andthereisanabundanceoffrequencyavailableinthosebands.PTPmodelfitstheurbanand

suburbanareasthebest.Itutilizeshigherfrequencybandsandtransmitsdatawithavery

narrowbeamwidthathighspeedandinashorterrange,thusreducingthechancesfor

interference.Itisalsoidealforlinkingmultipleaccesspointsinruralregionswhereadirectlink

isrequired.Wirelessisanidealoption,forruralareaswherethereisnotmuchofdemandfor

bandwidth.

BroadbandoverPowerLine(BPL)BPL,duetoabsenceofinfrastructurecosts,isthecheapestoptionavailable.Technologyuses

theconventional60HzpowerlinestotransmitRFsignalsacrossfromthebackbone

infrastructuretohouses.Thoughinexpensive,thistransmissiontechnologyissubjectto

significantamountofnoisethatisgeneratedbecauseoftransientsintheelectricitylines.To

remedydegradationinqualityofsignal,Internetprovidersneedtousemultiplerepeaters

whichinturncandramaticallyreducethebandwidth.Thus,thisschemewillbeleastthe

38


39/41

favoritealternativeforbackbone.However,itcansatisfactorilyservesomeoflowdatarate

applicationssuchassmartgrids.ItisalsoattractivefortransmissionofInternetbetween

housesinaccesspoints.

SatelliteLinksSatellitelinkshavethepotentialtoreacheverycorneroftheearth.However,satellitedoesnot

offeratruebroadband.Mostofcurrentsatellitetransceiversofferdownstreamdata

transmissionviasatellite,whiletheupstreamtransmissionhappensthroughatraditionaldial

up

connection.

Duplex

systems

though

available,

face

scarcity

in

bandwidth

and

limitation

in

capacity.Theotherfactorthatmakessatellitetechnologiesunattractive,particularlyfor

applicationssuchasVoIPthatneedinstantaneouscommunication,iswhatintechnicalcontext

isreferredtoaslatency.GeneralAccountabilityOffice(GAO)explains,

SatellitetechnologycanprovideahighspeedInternetservicethroughoutmostofthe

UnitedStates.However,themosteconomicalpackageofsatellitebroadbandservice

generallyoffers,atthistime,upstreamspeedsoflessthan200kilobitspersecond,and

thereforethisservicedoesnotnecessarilymeetFCCsdefinitionofadvancedtelecommunicationsservices,whileitdoesmeetFCCsdefinitionofhighspeedservice.Despitethenearuniversalcoverageofsatelliteservice,consumersneedaclearviewof

thesouthernskytobeabletoreceivetransmissionsfromthesatellites.Additionally,

transmissionviasatelliteintroducesaslightdelay,whichcausescertainapplications,

suchasVoIP(i.e.,telephoneserviceovertheInternet),andcertaincomputergamingto

beillsuitedforuseoversatellitebroadband.54

Thus,satelliteremainsasanoptioninareaswherethereisnoothermeantoreachtheusers

suchassomeareasinAlaskaandMontana.

54U.S. Government Accountability Office, Broadband Deployment Is Extensive throughout the United States, but It

Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas (May 2006), www.tinyurl.com/y4f4t3.

39
http://www.tinyurl.com/y4f4t3http://www.tinyurl.com/y4f4t3


40/41

iii. ApplicationTableUpstreamanddownstream

speed ApplicationsVoIP WebBrowsing

500kbps 1Mbps SMS StreamingVideo

BasicEmail LowQualityVideo

WebBrowsing FileSharing(small/medium)

1Mbps 5Mbps Email(LargeAttachments) Telecommuting(ordinary)

RemoteSurveillance Digitalbroadcastvideo(1channel)

IPTVSD(13Channels) Streamingmusic

Telecommuting HDvideodownloading

Filesharing(Large) Lowdefinitiontelepresencegaming

IPTVSD(multipleChannels) Medicalfilesharing(basic)

5Mbps 10Mbps SwitchedDigitalVideo RemoteDiagnosis(basic)

VideoonDemand RemoteEducation

BroadcastSDVideo BuildingControl

VideoStreaming(23channels)

Telemedicine Highqualitytelepresence

10Mbps100Mbps EducationalServices HDsurveillance

BroadcastVideoSDandsomeHDIPTVHD smartbuildingcontrol

Gaming(complex) Telecommuting(highqualityvideo)

100Mbps1Gbps HDtelemedicine VideoonDemandHD

Multipleeducationalservice Gaming(immersion)

BroadcastVideofullHD

Remoteserverservicesfor

telecommuting

FullIPTVchannelsupport

1Gbps10Gbps Researchapplications Telesurgery

Remotesupercomputing Terabytedatatransfer

Livecinemastreaming

Table4.HighspeedInternetapplications55

55Source:CapturingpromiseofbroadbandforNorthCarolina,June2008,availableatwww.e

nc.org/pdf/Broadband_report_es_composite.pdf.

40
http://www.e-nc.org/pdf/Broadband_report_es_composite.pdfhttp://www.e-nc.org/pdf/Broadband_report_es_composite.pdfhttp://www.e-nc.org/pdf/Broadband_report_es_composite.pdfhttp://www.e-nc.org/pdf/Broadband_report_es_composite.pdfhttp://www.e-nc.org/pdf/Broadband_report_es_composite.pdf


41/41

AbouttheAuthor

Milad

Alemohammad

IEEEUSAWISEInternandStudentofElectricalandComputerEngineering

MiladAlemohammadisaB.S./M.S.studentinElectricalandComputerEngineeringatDrexel

University,Philadelphia.Miladsareasofinterestincludetelecommunications,microwave,and

photonicsengineering.HisresearchatDrexelinvolvesopticalgenerationofrapidlytunable

millimeterwavesubcarrierswherethetuningrangeexceeds100GHz.

During

the

summer

of

2009,

he

served

IEEE

USA

as

a

WISE

intern,

where

he

supported

policies

onexpansionofmoreaffordablebroadbandservicestoruralAmerica.

MiladismemberofIEEE,andtheDrexelUniversityPennoniHonorsCollege.Healsoservesas

treasurerofthelocalchapterofEtaKappaNu,theelectricalandcomputerengineeringhonor

society.

[email protected]
mailto:[email protected]:[email protected]

Documents

Broadband++the+Road+to+21st+Century+Economic+Growth