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Remote work can’t change everything until we fix this $80 billion problem

The U.S.’s rural areas still suffer from limited broadband availability. Addressing that may take both government investment and new technologies.

Remote work can’t change everything until we fix this $80 billion problem
[Photos: Ivan Bandura/Unsplash]
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Providing reliable, high-speed internet to remote parts of the U.S. has been a challenge for years. And the COVID-19 pandemic has created a renewed sense of urgency to solve it.

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Since the outbreak, many employers have outlined plans to make their remote work policies permanent. Many knowledge workers are taking this opportunity to leave big cities for more rural destinations. This presents a significant economic opportunity for rural communities, but only in those areas that can offer residents access to robust broadband internet.

Finally solving America’s digital divide will depend on either a technological innovation or governmental intervention. Now there is hope that at least one of those things could be just around the corner.

High-speed internet is a game changer for rural economies for three reasons. First, it enables next-generation farming capabilities, such as self-driving tractors and combines, greater data collection and utilization, predictive maintenance, and more. Second, it can provide access to remote employment opportunities. And third, lack of broadband is a deal breaker for remote workers looking to settle in more rural destinations.

“If broadband can be increased in rural areas, it would have a dramatic impact, both for people currently living in those areas and for people who are looking to shift their lifestyle away from the cities or the suburbs and move to a more rural location,” says Brie Reynolds, the senior career specialist at FlexJobs.

According to a recent study conducted by SatelliteInternet.com, two-thirds of remote workers are interested in moving out of the city in order to enjoy more living space and a lower cost of living. However, 67% indicate that internet availability affects their decision, and 36% said a lack of access to broadband internet is preventing them from making the move.

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The Federal Communication Commission’s (FCC) definition of “broadband internet”—which does not exactly set a high bar—includes a minimum download speed of 25 megabits per second (Mbps) and an upload speed of 3 Mbps. According to the FCC’s Broadband Progress Report, 19 million Americans—roughly 6% of the population—do not have broadband access. The vast majority of those, roughly 14.5 million, are based in rural areas. In fact, one-quarter of rural Americans and one-third of those living in tribal areas lack internet access that meets the agency’s minimum requirements.

“There’s a lot of parts of the country that rely on aging infrastructure like DSL with much slower speeds than the FCC recommended 25 Mbps, especially on the upload side, where the average will fall below what’s required for a Zoom call,” explains SatelliteInternet.com staff researcher Tim Tincher. “If we have aging infrastructure that can’t support Zoom calls, like DSL or even satellite Internet, that can be a major blocker to building out the economies of these more underserved areas.”

Small markets get left behind

Rural regions have traditionally struggled to gain access to high-speed internet due to the cost of the infrastructure required to deliver it. Private telecommunications providers typically avoid building cable lines that extend to sparsely populated regions because there simply aren’t enough customers to justify the cost.

“When you think about the number of miles of fiber you need to lay in order to service a single home, when the density falls off in rural areas, the economics really just don’t work,” explains Doug Brake, the director of broadband and spectrum policy for the Information Technology and Innovation Foundation (ITIF). “It’s a classic market failure, where we absolutely need government subsidies to build what are increasingly critical services for 21st-century life.”

Brake explains that this digital divide has been a persistent problem for lawmakers and policy advisers for decades, but the pandemic has further emphasized the significance of the gap.

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“Especially recently, with stay-at-home orders and people trying to do what they can to limit the spread of the disease, the importance of broadband has become even more apparent,” he says. “Policymakers at all levels of government need to be taking this issue seriously, especially when you’re seeing such dramatic changes in the workforce as a result of the pandemic.”

The $80 billion problem

In January 2017—the day before Donald Trump was inaugurated as president—Tom Wheeler, then the chairman of the FCC, published a report that found it would cost $80 billion to provide universal broadband access to all Americans. The plan has received renewed focus in recent months as a result of the pandemic, but only from one side of the aisle.

“[Democratic] Congressman Jim Clyburn has proposed it twice, and it’s passed the House twice as part of the COVID [relief] bill—a $100 billion package—and it’s died twice in the Senate,” says Wheeler, now a fellow at the Brookings Institution.

Wheeler is hopeful that a change in U.S. leadership can help such a bill become law. Even once the Biden era begins, however, it would likely still have to pass through a Republican-controlled Senate.

“I would hope the broadband companies would get behind this, because they would be the beneficiaries,” he says. “I can’t understand why they’re not using their lobbying muscle to say to the Republican senators that are blocking this concept, ‘This is good for America—let’s make it work.'”

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Many would expect broadband access to receive bipartisan support, given that it is being advocated by Democratic lawmakers but would most benefit people in areas that typically vote Republican. In fact, rural voters favored Republican incumbent Donald Trump by a 10-point margin in the November election.

“In the 21st century, it is of greater importance than universal telephone access, and we had a policy 40 years ago that said ‘Here’s how we’re going to provide universal telephone access, and everyone gets a quality telephone line,'” says Wheeler. “That’s the same kind of thinking we have to have now.”

A case study for the power of broadband

Wheeler believes universal broadband is the key to rebuilding rural communities devastated by rapidly declining employment in mining and manufacturing, and there are case studies to prove it.

Farming would be improved with broadband connectivity, education would be improved, healthcare would be improved.”

Former FCC chair Tom Wheeler
In 2009, unemployment in Jackson County, a coal mining community in eastern Kentucky, had reached 16%, rendering McKee—a town of about 800 at the time—among the poorest in the nation. That year, the People’s Rural Telephone Cooperative (PRTC), a local nonprofit, borrowed $20 million from the U.S. Department of Agriculture. It also received $25 million from the American Recovery and Reinvestment Act of 2009—then-President Obama’s recession stimulus bill—to pull one thousand miles of cable to all seven thousand houses and businesses in the county.

According to a New Yorker feature about the initiative, “in the most rugged terrain around McKee, the crews relied on a mule named Old Bub to haul the cable two or three miles a day.”

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“The economy was devastated until fiber came along,” says Wheeler, who visited the one-traffic-light town during his time as FCC chairman. “They have more people employed in McKee today than they did 10 years ago, despite the fact that the coal economy collapsed.”

Today, unemployment in the county is less than 5.5%, as residents are able to take advantage of remote work opportunities for employers based elsewhere. Wheeler points to McKee as an example of how investment in broadband access pays for itself through employment, tax revenue, and economic activity.

“What we have seen is that connectivity drives economic activity,” he says. “Farming would be improved with broadband connectivity, education would be improved, healthcare would be improved; it doesn’t require a lot of detailed studies to know that the more you connect, the greater the opportunity for economic growth and activity.”

Alternative broadband: just around the corner

Providing direct, wired, broadband access to rural America would come at a significant cost, but Wheeler is hopeful that the incoming administration will include its funding in a stimulus bill early in the new year. Even if it doesn’t, however, Tichner of SatelliteInternet.com is optimistic about a number of wireless alternatives that are poised to make significant strides in the coming months.

“There are a lot of upcoming technologies that will hopefully get more support going forward, whether through the CARES Act or another federal funding initiative,” he says.

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One of the most promising alternatives is low-earth-orbit (LEO) satellites such as Starlink, a project created by Elon Musk’s SpaceX that is currently in testing. An email sent to beta testers in October promised speeds ranging from 50 to 150 Mbps at a cost of $99 per month, plus an initial $499 setup and equipment fee.

Tichner says that most satellite internet solutions require information packets to travel significant distances into space and back, resulting in slow connection speeds. LEO satellites are positioned much closer to the earth and can therefore bounce a signal back at a much quicker rate.

“The latency is much shorter, so it’s a lot more like a terrestrial or hardwired type of connection, which is a huge improvement from traditional satellite connections,” he says. “That would provide internet access to people in areas where they don’t have other options, and have speeds and quality they haven’t had before.”

Tichner adds that there aren’t any data or speed caps imposed on Starlink customers at this point. However, the system has its limits, and it remains to be seen whether increased traffic will affect performance once it’s made available more broadly.

The other alternative for providing broadband access to rural communities without physically connecting every structure by cable relies on existing cellphone towers. Fixed wireless broadband is an emerging technology that transmits signals from a single base station, not unlike 3G, 4G, and now 5G towers that provide internet connections to mobile devices.

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“It’s not nearly as sexy as the low-earth-orbit stuff, but fixed wireless broadband has really changed the economics, where you don’t need to string cables on telephone poles or bury them underground,” explains Brake of ITIF. “You can just point a wireless link and really cover a lot of ground, like two miles, and just have a connection point in the center of town.”

Fixed wireless broadband is easier to set up, from an infrastructure perspective, though it often costs more for end users than traditional wired broadband. Users also need to install a satellite dish with a clear line of sight to the transmission tower, and their connection could be compromised by poor weather conditions.

That is why, despite the potential of these alternative solutions, Wheeler is firm in his belief that there is no viable alternative to traditional, wired connections.

“What bothers me the most is [alternatives] are just not future-proof,” he says, adding that capacity can be easily increased over time when internet is delivered by fiber cable, but not necessarily through wireless alternatives. “We need fiber first, then we can look at other alternatives.”

About the author

Jared Lindzon is a freelance journalist and public speaker born, raised and based in Toronto, Canada. Lindzon's writing focuses on the future of work and talent as it relates to technological innovation, as well as entrepreneurship, technology, politics, sports and music.

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