Infrastructure Bill Is Great For Broadband, But Still Ignores The Real Problem (Monopolies & Corruption)

Broadband

from the half-the-battle dept

After months of intense wrangling, the Biden administration’s infrastructure bill has finally made it through Congress, delivering a massive injection of much-needed funds to an absurdly overlooked part of the economy. You might recall the broadband component of the bill saw its overall price tag cut from $100 billion to $65 billion. There were several other changes made at the request of the telecom lobby, such as a slower speed definition standard and the elimination of language to help community broadband. But it’s still the biggest U.S. broadband investment on record, and filled with a lot of great things.

The Benton Foundation has done a good job breaking down what the money in the bill actually does in a multi-piece series.

Most of the bill’s funds ($42 billion) will be used to create a State Digital Equity Capacity Grant Program that involves grants to be doled out by the NTIA. Those grants will be used to shore up broadband gaps and fund digital divide initiatives. Additional funds will be used to deliver grants aimed at shoring up so-called “middle mile” networks (between the “last mile” to your home and your ISP). In most cases this money has to be spent in the next five years.

The bill also sets aside $14.2 billion to make the current Emergency Broadband Benefit (EBB) program permanent. The current EBB doles out $50 per month ($75 per month for tribal areas) to ISPs, which in turn use that money to provide discounts to low-income households that qualify. The bill lowers that tally to $30 a month. $2.75 billion will be used for digital inclusion and equity projects like helping seniors get online, $4 billion will fund programs at both the NTIA and USDA aimed at shoring up tribal broadband access, and another $600 million will specifically go toward addressing rural broadband gaps.

To be very clear, these programs will do a hell of a lot of good shoring up U.S. broadband coverage gaps and improving affordability for millions of Americans. The bill does some other very good stuff, like revisiting mandatory transparency requirements for ISPs, requiring they disclose all hidden fees and line limitations at the point of sale.

The problem with these kinds of ideas has been implementation and follow up.

The U.S. has thrown billions of dollars at this problem, yet up to 42 million Americans still lack access to broadband, and another 83 million live under a broadband monopoly. The core reason for this problem is regional monopolization and the state and federal corruption that protects it. Throwing more money at the problem without seriously addressing the underlying rot means you’re not going to genuinely fix it. Many states in particular are just gobsmackingly corrupt, and the idea that this corruption won’t seep into these efforts at a large scale is fairly naive.

Again, good bills are only as useful as the follow up. For example, there were months of reports on how major ISPs were exploiting the EBB discount broadband to basically upsell subscribers to more expensive tiers. What was done about it? Nothing, really. For decades, state and federal regulators and lawmakers threw billions of dollars in subsidies, regulatory favors, and tax breaks at entrenched regional monopolies for job growth and broadband deployments that were either half-completed or never arrived. What was done about it? Absolutely nothing.

So yeah, stuff like the EBB is great, but it’s just a band aid on the real cause of the problem: regional monopoly power. And things like transparency requirements for ISPs are also great, but they’re only as useful as the FCC’s willingness to stand up to politically powerful companies like AT&T to enforce them, which historically has been… mixed at best.

U.S. broadband in 2021 isn’t spotty, expensive, or slow because of technical or financial obstacles. It’s spotty, expensive, and slow because the sector is dominated by a handful of powerful monopolies that don’t just dictate policy — they literally write the rules of the road. The end result is a broken, mindlessly consolidated market mired in regulatory capture. Everything, from net neutrality and privacy violations to crappy customer service and high prices, is a direct result of a conscious policy choice to pander to the biggest, wealthiest providers. Pointing this out in telecom policy is generally deemed hyperbolic or impolite.

So while there are a lot of very good things in these bills that should deliver concrete help to a lot of places, we still seem to be operating under the delusion that U.S. state and federal telecom oversight isn’t a corrupt mess. It won’t be particularly difficult for giants like AT&T to leverage their political power (which, in a long list of states, is near-absolute) to elbow out competitors, misdirect funds they don’t deserve, or otherwise hamstring anything that threatens their interests. Actually making sure these funds are spent correctly will require the kind of diligence and follow up that’s long been lacking.

Filed Under: broadband, corruption, infrastructure, joe biden, monopolies