The digital divide is worse than we thought.

The digital divide is worse than we thought.

On April 12, FCC Chairman Ajit Pai proposed a $20 billion rural broadband fund to connect up to four million homes and small businesses with up to gigabit acceleration over the next 10 years, to bridging the deep digital divide in the United States. Although this fund is a good start, much remains to be done. Rural Americans still have few options for cable broadband Internet service; Currently, the FCC estimates that 19 million Americans living in rural areas do not have access to cable broadband. To go further, access is not synonymous with affordability. Most of the discussion of the digital divide has focused on access, but the prices that rural consumers pay for available services are also worth considering. According to our research, about 146 million rural Americans do not have access to a cheap package for cable broadband internet access. This represents nearly 45% of the US population. We define the term "low price" as a broadband plan that has a monthly cost that is less than or equal to the 20th percentile of all package prices, or approximately $60 per month. Rural houses pay more for reduced speeds, which shows that the problems of the digital divide are worse than we think. Rate Split Map Access to low-cost broadband is essential for millions of families in the United States, but it seems that those who need it most have the least coverage. States with a median household income of $60,000 or more average 78% low-cost plan coverage, compared to just 37% for states with incomes below $60,000. To illustrate this point, consider two states, Massachusetts and Montana. . In the first case, the median household income is $77,385 and the poverty rate is 10.5%. Low-cost broadband plans are available to nearly 100% of the population served by a wireline service provider. In Montana, the median income drops to $53,262, with a poverty rate of 12.7%. How many of these Montanais have access to a cheap plan? One Percent Image Credit: Shutterstock (Image: © Shutterstock) Lack of rural competition keeps prices high and access low. Competition is driving prices down, and fewer options in rural areas appear to be a key factor in the digital divide. Urban areas are highly competitive and densely populated, which encourages investment from major providers. Rural areas may be lucky with only one option for cable broadband, and population density is a predictor of cheap plan coverage. In fact, ZIP codes in the lowest 10% of population density pay up to 37% more on average for residential fixed broadband than those in the nation's wealthiest 10%. It is clear that there is still work to be done here. The Way Ahead So what can be done to improve the current state of rural broadband Internet access? This is a complex issue, and no single sea change is likely to fill the void. Improving access to neglected markets and lowering prices in neglected markets will likely involve multifaceted efforts by service providers, state governments, and governments. Federal government, as well as communities across the country. An immediate step toward achieving this goal is to improve the coverage reporting process. Today, reporting broadband availability is a significant issue that disproportionately affects Americans living in rural areas. A number of initiatives are currently planned to reorganize this process in the coming years, both within the government and in the private sector. Communities, for their part, can invest in pro-competitive programs such as municipal broadband operations and "one-time dig" policies. These allow people to help define the services they have access to locally and allow municipalities to take charge when they want to bring their residents online. Finally, new grants are needed to help make critical infrastructure improvements in underserved (and unserved) areas. This is where the FCC comes in, and Chairman Pai's proposed budget cap underscores the broader issue at stake here. If we want to provide robust connectivity to our underserved communities, we will have to start building new bridges without restricting the ones we already have.