A new report from the Vernonburg Group encourages public officials who want to increase digital opportunity for their constituents to focus on adoption and education-focused programs instead of funding overbuilds where broadband access is already available.
The paper takes direct aim at governments considering overbuild funding for municipally owned networks, municipally controlled utility providers (usually electric co-ops), and community-managed, open-access networks.
Overbuilds managed by these organizations may suffer from “conflicts of interest, inadequate technical capacity to construct and maintain the network, and a lack of sufficient resources to ensure the network’s viability and success,” the report authors said. Further, the projects may require continued taxpayer subsidization after being built.
The Gap Between Access and Adoption, and the Opportunity
Only 6% of the U.S. lacks access to broadband internet, while 20% choose not to subscribe to internet services, the analysis said.
The data isn’t new. It was released as part of the U.S. Census Bureau’s Current Population Survey of 2023. However, potential savings calculated by the Vernonburg Group could sway decision makers as they decide how to allocate funding for local, state, and national programs intended to close the digital divide.
A hypothetical adoption-focused program for a population of 2,000 people could cost between $7 million and $9.5 million in the first five years, while overbuilding in the same community could cost the same community between $15 million and $54 million, the authors wrote.
That’s a difference of at least $8 million and up to $47 million, and that’s just for one community.
Digital literacy programs that focus on adoption and education could cost between $7 million and $15 million over five years, according to projections by Vernonburg Group. In contrast, the report said funding overbuilds could cost up to $54 million.
Examples of Adoption-Focused Funding
Policymakers who choose adoption and education rather than overbuilds have many programming options to choose from, the report said. They could adjust funding for such programs according to community needs and funding availability over time.
Authors recommended the following as examples of education and adoption-focused spending:
- Local government capacity: Wages, training, devices, and materials for 10 digital navigators
- Affordability subsidy (service): A tech support hotline staffer, basic digital literacy trainings twice a month, a workforce development training program, and LinkedIn Learning subscriptions
- Affordability subsidy (devices): A $30 monthly subsidy for broadband for 2,000 eligible low-income households (with higher-end estimates including an annual spend of $200 per household for broadband service fees and equipment at customer homes)
- Digital navigators: A one-time spend of $100–$200 for a computer for 2,000 eligible low-income households
- Tech support and digital skilling: Four staff positions, including a digital opportunity lead, a community engagement specialist, a program manager, and a part-time administrative lead
How the Data Was Collected
The 30-page overbuilds report analyzed publicly available data from the U.S. Census Bureau, the Federal Communications Commission (FCC), and private groups including US Telecom, the Brookings Institute, and the Pew Research Center.
It also did mini case studies of three communities that are either considering overbuilds or have already started on such projects:
- Vineland, New Jersey
- Falmouth, Massachusetts
- Knoxville, Tennessee
The communities faced unique challenges to adoption, ranging from a high percentage of low-income families to aging populations and distrust of government programs.
Vernonburg Group represents at least one Fortune 100 internet service [rovider (ISP) and is actively seeking clients and subgrantees eligible for Broadband Equity, Access, and Deployment (BEAD) Program funding, according to the company blog and posts on LinkedIn.
The group was founded in 2020 by Paul Garnett, a Microsoft alumni and former assistant vice president of CTIA–The Wireless Association.
The new overbuild report comes just days after the National Telecommunications and Information Administration (NTIA) released new rules for allocating funding for the BEAD.
The report also followed calls from the National Rural Electric Cooperative Association (NRECA) for the NTIA to create a “true-up” process for overbuilds to ensure that locations in areas approved for BEAD still qualified.
