Three Ways to Bring Better Broadband to Residents

By Britt Harter

Britt Harter is a director in PwC’s state and local government practice. He specializes in policy and strategy questions at the interface of environmental, social, and economic vibrancy.

Sep 26, 2016 | Governance, Technology | 0 comments

The federal courts recently ruled that high-speed internet service is a utility – a decision that affirmed the government’s view that broadband is as essential as the phone and power, and should be available to Americans. In doing so, they paved the way for broader adoption of affordable, reliable, high-speed broadband service.

The stakes are high for getting this right. Academics and thought leaders agree that broadband delivers significant benefits today and will unlock even greater ones in the future. From increased educational attainment to improved delivery of city services, broadband access helps residents. For cities, it drives economic growth and attracts 21st century innovative businesses. It also provides a platform to reach Smart City solutions that deliver cost savings, improved public safety, and quality of life benefits like traffic and air quality.

Despite the value at stake, those on the ground in the U.S. know that broadband currently underperforms the needs and expectations of businesses and residents. In most U.S. cities, high infrastructure costs create barriers to entry and allow existing market players to deliver speeds and prices that lag international cities like Seoul, Tokyo, Paris, and London. This lack of competition also exacerbates the “digital divide” for those with limited resources.

Even when the problem is well known, solving it can be challenging for city officials. The topic is very active with a commotion of new technologies at various levels of maturity touting reduced infrastructure costs and improved coverage (e.g., fixed wireless and 5G).  Emerging players as well as powerful cable and telecom incumbents offer low-capital-cost deals to cities, but sometimes leave difficult-to-reach residents behind. Additionally, municipally owned and operated solutions, while appealing, can require substantial new capital spending, skills, and head-count.

The time is now – city governments should work to deploy broadband across their communities. There are three key approaches cities can take to leverage the tested tools of economic development:

Reach an open and competitive broadband market by leveraging the unique strengths of your city

The end goal is ubiquitous, accessible fiber that allows for competitive access by broadband providers.  This will create a proliferation of offerings and drive competition on key service aspects like access, speed, price, and reliability. But each city needs to use its unique context and strengths to reach that common end state. While a massive, municipally controlled fiber build-out will deliver ubiquitous fiber access and allow the city to control key service outputs, that is not within the reach of all cities. Strategic cities are solving this challenge by building off their current strengths to improve broadband in their city.  In some cities like Chattanooga or Lafayette, a municipal model is logistically manageable and palatable to the populace. In London, a formerly centralized system telecom created a platform for access to a common network. In others cities, they are combining existing fiber (e.g., subways, disaster resilience, and schools) to create the beginnings of an open network.

Plan additional interventions for closing the “digital divide”

The future requires fiber, and lots of it. But fiber alone will not close the “digital divide”— giving the benefits of internet to at-risk or low-income residents. Like housing, many cities will have a meaningful number of residents who cannot afford market-priced options, even in a well-functioning market. Broadband has additional complexities (e.g., hardware and skills) that can prevent even those with affordable access from reaping the benefits of broadband. Cities will need to allot specific budget and skills to engage those without internet access—understanding and targeting the unique barriers of its communities.

Develop a solid execution plan that stakeholders work together to carry out

One reason that broadband in the US is slow to make progress is that execution is particularly challenging for governments.  It requires the coordination of a wide range of complex skills (e.g., strategy, technology implementation, contracting and enforcement, low-income resident engagement, permitting, infrastructure construction and maintenance). Many cities struggle with execution because of the breadth of agencies and skills required to turn a plan into a reality. Successful models empower one entity to direct and coordinate fiber deployment and oversight. This allows for a strategic coordination of existing fiber, new deployment, and the ability to capture efficiencies and benefits across agencies. However, each city’s implementation plan needs to be acceptable to key stakeholders and within the skills and powers of those charged to execute.

Cities can play an enormous role in broadband expansion – and there is no greater incentive or motivation than improving the potential of their communities and residents.

For more information, feel free to contact me at benjamin.b.harter@pwc.com.

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