This was a continuation of a trend: only a few months ago the OECD ranked America 12th. Even more mortifying, when ranked against all countries on broadband penetration (percentage of homes connected), the United States came in 24th—behind such powers as Iceland, Finland and, yes, Estonia. In terms of the raw number of connected homes, we still hold a lead at 60 million broadband subscriptions, but China, with 56 million, is gaining fast. FCC Commissioner Michael Copps called the OECD report “a national embarrassment … In broadband, we’re not even an also-ran.”
“It’s not just a matter of national pride,” says Ben Scott, the policy director of Free Press, a consumer-oriented D.C. think tank. “A country that’s fully connected has access to tools that let citizens do jobs that we can’t do. The cost of falling behind can be hundreds of billions of dollars every year.”
Although President George W. Bush promised during his re-election campaign that all Americans would have access to affordable broadband by 2007, many rural Americans have no way to connect. It’s impossible to tell how many, in part because of the bizarre way the FCC measures the issue: if just a single building in an entire ZIP code is connected—a library, a school, a business—then all people in the area are counted as having access, even if there’s no cable and their phone company won’t give them DSL. (Because the signal deteriorates over distance, the telcos find it prohibitively expensive to offer the service to customers in far-flung areas.) Many rural homes can theoretically get broadband by satellite dish, but the cost is high and the service not as fast as other alternatives. In any case, a new study by the Pew Internet & American Life Project reports that fewer than one in four rural Americans has high-speed connections at home, compared with about 40 percent of suburban and urban dwellers. (A more recent survey pegs total U.S. penetration at 50 percent; South Korea’s is 90 percent.)
Another problem is that, compared with broadband in some other nations, our connections are anything but “high speed.” The FCC defines “broadband” as a connection that delivers 200 kilobits a second, either to (downstream) or from (upstream) the computer. That’s only four times the dial-up rate—and totally useless for YouTube. “Our definition needs to change,” says Cisco CEO John Chambers, for whom better broadband has become sort of a crusade. Rep. Ed Markey of Massachusetts, head of the House Subcommittee on Telecommunications, is proposing that we don’t call it broadband unless it’s at least 2 megabits per second. That pales in comparison with what’s already available in many other countries: 50 or even 100Mbps broadband, fast enough for what Chambers calls the “next wave” of services like realistic videoconferencing, remote health-care consultations and you-are-there shopping. “We’re playing catch-up when we ought to go where the market’s going,” he says.
Americans are paying more to putter around the Net at golf-cart speeds than citizens elsewhere spend to race around the Web in Porsches—often seven to 10 times as much. AT&T charges its former BellSouth customers $33 a month for its “Ultra” DSL service—1.5Mbps downstream and a pokey 256 kilobits upstream speed. U.S. cable companies charge about $40 for 4Mbps. But in Japan, customers pay $30 a month for 50Mbps.
Critics say the root of the problem is extremely limited competition: most Americans’ choices reside in a cozy duopoly of a single cable company and a single telco provider. It’s no surprise that those selling high-cost, low-speed broadband defend the status quo. (AT&T says it’s committed to providing broadband to all; Verizon touts its new premium fiber-optic service, but what you’ll pay depends on where you live: in a few locations, people can buy “up to” 50Mbps for $140 a month; in others, you’ll pay $180 a month for 30Mbps.) But the administration, supposedly dedicated to pumping up our broadband muscle, also maintains that things are hunky-dory. “I think our policies are a success,” FCC chairman Kevin Martin said at a conference last week, citing increases in the number of broadband homes. (Just imagine what he would have said if we had Korea’s numbers.) “We have the most effective multiplatform broadband in the world,” says John Kneuer, the Commerce Department’s head of the National Telecommunications and Information Administration. Why the low grades in the OECD study? Because, Kneuer says, the study itself is faulty. In fact, sniping at the methodology of that report is de rigueur among those who think our national broadband approach is just fine.
In any case, the OECD study—and the indisputable fact that our penetration is middling, our prices are high and our speeds aren’t speedy—have galvanized some legislators. Representative Markey and Sen. Daniel Inouye of Hawaii are sponsoring bills to require accurate measurements of the depth of the problem, in hopes that by quantifying it we’ll actually do something about it. “If we get a good policy in place, we should be able to reverse the problem,” Markey says.
FCC Commissioner Copps isn’t so sanguine. “Every generation in America has had an infrastructure challenge. And the response has been canals, turnpikes, railroads and the interstates,” he says. “But in the 21st century, it seems that no one is looking out for us. We’re frittering our future away.” Silicon Valley, meet Estonia.
