The Question of Internet Affordability Beyond ACP - Episode 594 of the Community Broadband Bits Podcast

Christopher Mitchell (00:07):
Welcome to another episode of the Community Broadband Bits podcast. I got my voice back. First time. I felt good saying that in a month. No, four months. Anyway, I'm back. I'm at home. I'm at home all week. It's exciting. And yeah, I'm Chris Mitchell with the Institute for Local Self Reliance. [00:00:30] I'm here with Ry Marcattilio. Welcome.

Ry Marcattilio (00:34):
Thank you, Chris. Good to be here.

Christopher Mitchell (00:35):
Ry's our research director type person. And then we got Sean Gonsalves, who is our communications lead type person. How are you doing?

Sean Gonsalves (00:42):
I am back.

Christopher Mitchell (00:44):
Where are you coming from? Where are you at?

Sean Gonsalves (00:46):
I am outside of the state of Massachusetts at an undisclosed location.

Christopher Mitchell (00:50):
That's why I asked.

Ry Marcattilio (00:53):
Here's what I tell you, Chris.

Christopher Mitchell (00:55):
I mean, he is got a view from the Nebuchadnezzar behind him from the Matrix. Oh,

Sean Gonsalves (00:59):
You [00:01:00] recognized it, Nebuchadnezzar? Yes.

Christopher Mitchell (01:02):
Yeah,

Sean Gonsalves (01:03):
I am deep in the Matrix, man.

Christopher Mitchell (01:05):
All right. So we are going to talk about a few different things, but I did want to start off by noting that for people listening to the Community Broadband Bits podcast, you might be missing some great content over at Connect This, the Connect this show has been just really steaming ahead. Apparently it's getting better. That's what people tell me. They enjoy it. We have regular [00:01:30] guests, Kim McKinley from Utopia, Travis Carter from USI fiber, who made his debut for the world on this show, I think more or less, as well as Doug Dawson, writer and creator of the Pots and Pans by CCG blog that is read throughout the industry. We've had special guests, Gigi, so she'll be back at some point recently had Brian Snyder on and Matt Rantin. Anyway, connect this show.com and you can watch it on YouTube or you [00:02:00] can get the audio only in an audio feed as well.

Sean Gonsalves (02:04):
I can now shake my head in agreement because when you first started, you know what I thought you were going to say is that you were missing out because I had a great guest lined up for the podcast, but I could only get Ryan and Sean.

Christopher Mitchell (02:16):
No, no, I'm excited. People like these episodes where we just talked playing the amongst ourselves. But I do have one other show to note when that's, we started doing this show Building for Digital Equity last year. It's features interviews [00:02:30] with people that are more doing kind of the digital equity work as opposed to building broadband networks and that sort of a thing. It's not a bright line between community broadband bits and the Building for Digital Equity show, but building for Digital Equity is typically a shorter interview, and we've got another season of that getting ready to fire up, and that will be heading to the Building for Digital Equity feed. So something to keep an eye out for. In fact, we're probably going to cross post one of the episodes because I just thought [00:03:00] it would be good for this audience to hear that as well.

(03:02):
So anyway, that'll be coming up. There's one other show that we'll be continuing to promote, but what we want to talk about today, we're going to talk about a couple of different things. But the first thing and the longest segment is going to be talking about Sean's article that just came out in the American Prospect, which is a monthly magazine that is, I mean mostly online now for most people read it, but focused on issues of monopoly and having markets that work. [00:03:30] And I think making sure that political and economic power distributed so that we all have some meaningful control over our lives, which is another way of saying that. It's pretty cool. Sean, what was the focus of your story?

Sean Gonsalves (03:45):
Well, the focus of the story is kind of the focus, I would say, of most of the folks that are in the, at least who classify themselves in the digital inclusion digital equity space, which is the end of the Affordable Connectivity Program. And so obviously we saw this [00:04:00] coming. Thanks in part to Ry and Christine and others who put together the ACP dashboard, which allowed us to get a sense more than a year ago that the ACP would be out of funds by around April, and it turns out that the funds are going to be out at the end of April. So I would say that that prediction was pretty good, but it is ominous news, especially because of the Internet for All initiative, as it's called by the Biden. White House is really starting to pick up steam in terms of the BEAD program [00:04:30] and the Digital Equity Act funding that's now coming out.

(04:34):
And the Affordable Connectivity Program, as I'm going to assume most of our listeners are familiar with, but in case they're not, we're talking about the $30 amount discount that the federal government provides to participating Internet service providers $75 a month if you live on, if you're a tribal citizen living in Indian country for good reason. And anyhow, that program is coming to a conclusion unfortunately [00:05:00] in April, unless there's some last ditch congressional effort that none of us see coming because it doesn't look like there's anything on the radar. There is an act that's been filed. The prospect for it passing don't look good. So we're looking at the end of the ACP, this particular article. I wanted to pull the lens back a bit and look at the affordability problem in a broader scope. And that meant that reminding people that there are many communities [00:05:30] rightly in a bit of panic about what to do about Internet affordability and the likelihood that potentially millions of people won't have Internet service. And I wanted to remind people that there actually are communities who have thought long and hard about this, tackled it from a different perspective as opposed to the ACP program and built infrastructure with affordability as its core component. And I wanted to highlight just a handful of those cities who have done that pretty [00:06:00] well so far. So that's what that piece was about.

Christopher Mitchell (06:03):
And one of the things that I wanted to jump in and note is that another person that was really involved with that was Emma. And I don't know if we announced Emma's departure from our team. We don't always announce departures. It's a little bit awkward because we're really sad to lose people we've been working with, but they have really great futures ahead of them. Usually. I'm not going to say that that's why they're leaving is their future is too bright to work for me. But Emma has moved on and we look forward to continuing to [00:06:30] work with her in the future in different ways we hope. But Emma's been on the show periodically and yes, so we did the ACP dashboard. I think that the end of that program, it was destined, right? I mean, it is not sustainable, not in that, I mean spending 7 billion a year on Internet access is that it's a bad investment. I think it's that we have a frustration that it is necessary because we have such a broken structure. [00:07:00] And so what I thought your article did a good job of showing is that we actually could spend less on these programs and get a much better return if we're not just funneling the money to big cable companies and wireless resellers of the mobile service from AT&T and Verizon and stuff like that.

Sean Gonsalves (07:21):
Yeah, I mean, that's a great way, a succinct way to put it.

Ry Marcattilio (07:24):
So I'll add, there are lots of examples of this. We saw a couple of them on the latest Building for Digital [00:07:30] Equity event that just ran live on YouTube and elsewhere, and you can find the recording afterwards, but we heard from Pharr, Texas, which has a baseline residential tier of $25 a month for 500 megabit symmetrical service, which is huge in Hillsborough, Oregon. They've got a $10 per month. I think it's gigabit symmetrical tier for families that qualify. And so certainly there are challenges in setting these things up, but let's not pretend that if you're not smart about the infrastructure [00:08:00] that you put into place and looking towards your own telecommunications future, that you can't build solutions that don't require massive constant subsidies.

Christopher Mitchell (08:11):
And you didn't mention Chattanooga, which any listener of this show I hope is familiar with the free program that they have for so many people to have access that comes from a local investment from City, county and private philanthropy support. So yeah, there are a variety of ways to approach [00:08:30] this. And the thing that just gets me is the number that sticks in my head is that the number of subscribers that I should say, the number of households that were on ACP in Cleveland works out to about $30 million a year of money from the federal government going to Cleveland, which I have to assume is mostly going to charter spectrum and to wireless resellers who are not actually really invested in making more investments to better serve [00:09:00] low-income families. It just so happens that DigitalC is making a big push across the city.

(09:05):
We talked with Joshua Edmonds about this in a show recently, but they got $20 million from the city and 10 million from the state, I believe, to try to do this major push, and they're going to get big results from that. And that's just an amount that in one year the federal government was, I would say, kind of throwing away in Cleveland because it wasn't spending it wisely. When we looked at the numbers [00:09:30] years ago before the EBB even came up because we saw something like this happening and the EBB was the predecessor to the ACP and found that for the amount of money that would be spent after about six or seven years of a program like this, a city would've been better off just putting that money into a fiber network and offering services for free because you would've had so many more benefits.

(09:54):
And that's just on the dollars and cents, it ignores all the indirect benefits of having done that. [00:10:00] And so I have mixed feelings about the ACP. We've covered that extensively. We probably don't need to spend a lot of time on that, but it hurts to see families that are struggling to pay their bills, lose this support. It's going to be really hard on the economies of many rural towns and in places where that's money in people's pockets that now won't be going to local restaurants or those sorts of things. At the same time, this was never a well-designed sustainable program. It was always a giveaway to the biggest carriers. [00:10:30] And that's not to say that it wasn't warranted, but we just need to do something else and we can't just be caught between doing nothing and throwing money away.

Sean Gonsalves (10:40):
It's a great point, and it was one of the reasons why I thought the Building for Digital Equity livestream, that Ry reference earlier, was so interesting because you heard from a variety of frontline folks and to stand out. I mean, so Ry talked about Pharr, which is highlighted in the article that I wrote, and that's an approach that in my mind, it's sort of an ideal [00:11:00] approach. I mean, because the benefit of municipal broadband is really, aside from the particulars of it, is having an ability to weigh in structure rates in such a way that it can be affordable to the large segment of the community. And as other cities highlighted in the program can create local programs that dedicate money to that. But one thing that I thought Meg Kaufer mentioned from the STEM Alliance during the Building for Digital Equity livestream [00:11:30] about this is that it struck me about the importance of also the digital literacy and the digital equity and the correlation between how comfortable people feel using this technology and how important they think it is in their perception of what's affordable. So I thought that was a really important point on the one hand. And on the other hand, there is this issue of competition paying a premium for terrible service in the importance of infrastructure. And it's an all of the above [00:12:00] approach. And so that's why I was struck by the Building for Digital Equity livestream, is that I think it kind of highlighted an array of those issues that I think all have to come to bear in people's minds when they're thinking about tackling the affordability issue.

Christopher Mitchell (12:16):
Meg was great. I feel a little stabbed right now. I dunno if it's in the front, the side or the back from you, Sean, because I feel like this conversation about people better understanding how to use the service, changing their [00:12:30] willingness to pay is something that we've talked about before. Because Travis is always on me like, well, what's a reasonable amount for Internet access? And I'm always like, that's a really hard freaking question because what some people will say, someone might say, well, why is this family buying a pack of cigarettes a day when they could use that money for Internet access? That's an uncomfortable place to be. At the same time, there's a reality that if the people who are making a decision in that family, I think see more value in the Internet, [00:13:00] then they're going to be more prioritizing a limited budget to paying for a service. But in good conscious, I don't want those people dropping 75 bucks a month on a cable service that's too much. They shouldn't be paying that much. It's ridiculous. It's because of a failure of government that they're stuck with only that option. So that's where it is awkward. But I agree with you in a weird way.

Sean Gonsalves (13:20):
Yeah, no, no, no. I mean, and this is what I mean, it's a nuanced thing. And then I think also as it relates to what you talked about a little bit, I think about a more long-term permanent [00:13:30] solution is that I do think even in communities where there is an affordable option, there'll still need to be a subsidy for a subset of the population moving forward. And so there needs to be a long-term solution to this that goes even beyond what you find in a lot of communities that have municipal broadband networks that are offering $20, $30, 25, that kind of monthly rate, which for someone like myself or any of us who rely on Internet connectivity to work, [00:14:00] I mean that's worth this weight in gold. But I think there are people who haven't quite yet wrapped their minds around all of the advantages that having that connection affords in addition to the things that may be at the top of mind when they're asked those kind of survey questions,

Christopher Mitchell (14:17):
As you know, I'm about to lose a tree in my backyard and the fact that I'm still here suggests it hasn't come down yet, but may take out the utilities at any point. And faced with the prospect of losing [00:14:30] electricity for perhaps a half a day or a day and Internet access for perhaps a week or more until the company would come and replace it, I was starting to panic a little bit, being like, maybe I'll get my neighbor to put their access point in their window or something because it's become that important to me. I can't imagine every to 10 minutes I'm looking something up. I'm reminding myself of something, I'm trying to be making decisions about things. And so for me, it's [00:15:00] like I say sometimes to folks, and this is a real life thing in places that have high cost of electricity, is if you doubled my electricity bill, I'm going to be more efficient, but I'm not going to stop using electricity. I'm going to find a way to pay it. That's where I am with Internet access. It's a core part of the way I operate. And I think Ry, I don't know if you feel any differently.

Ry Marcattilio (15:22):
No, I agree with you a hundred percent. And the corollary to what both you and Sean were saying, of course is no matter if you're paying $30 [00:15:30] a month or $50 a month or $75 per month for your Internet connection, if that infrastructure is owned and operated by your city, those dollars are staying inside your city. They're not being whisked away to some corporate bank account that gets used to pad the bonuses for executives at the end of the year as they shuffle from place to place. And so you get all sorts of direct benefits from that, the Internet utility paying into the city or contributing in direct ways. But then you also get [00:16:00] all the indirect economic and other social benefits that go along with that, maybe a more reliable electric grid, more people participating in telehealth appointments, which lowers the cost of healthcare in that region, remote education, small business, et cetera, et cetera, et cetera. And so it's easy to, I think, run right past the fact that when you own the infrastructure in your community, those dollars stay inside your community.

Christopher Mitchell (16:27):
One of the things that I come back to as well is just the decision [00:16:30] making. There was a time early on in Chattanooga's network where they were thinking about implementing a cap on transmission on bandwidth usage, and there's reasons for why they were considering it, which was legitimate, but they were open to a community conversation about what that might do and ultimately decided that they would not implement a cap. This is their first gig city. They're worried about how people might abuse it and run their costs up, and they basically came up with a way in which if they saw people exceeding a normal usage by [00:17:00] a few orders of magnitude, then they would have a conversation with them rather than just being like, you're cut off. And that's the sort of thing you can do. You can change the policy at the local level assuming that the utility is actually responsive to that sort of thing.

Sean Gonsalves (17:14):
It's a good point that all of you're making Ry included in terms of that money circulating in the local economy. I think another benefit of some of these community centric situations is that [00:17:30] it also allows for you to do things like we heard Pharr talk about, which I thought was really interesting, which is expand as an ISP into is traditionally being considered the digital inclusion space. They were talking about telehealth, they're talking about expanding and using that infrastructure as a way to improve people's lives. And as I think someone said during the Building for Digital Equity live stream was that we're really a big chunk of what we're talking about are wrestling with issues of poverty, and this is one [00:18:00] facet of that, but there are things that local communities can do, and so as discouraging as it is to see the ACP wither and look like it'll die, although it could sort of resurrect in some other sort of form at some point in the future, it's just that there is a hopeful story to be told. And I tried to get at that a bit in the article, which is about reminding people essentially that there are things within reach [00:18:30] of local communities and municipalities in solving these kind of issues that don't kind of rely on sort of the hat in hand, please do better ICP approach that we've relied on for a couple of decades now.

Christopher Mitchell (18:44):
Yeah, no, it is funny. We can have dignity, we can do better, we could pay less. It's actually not as hard as people might think. It really is. This is a wire to every home. We've figured out how to do that in the past, [00:19:00] and I'm not for creating a new monopoly generally, but at the same time, we can do much better. We are not in the worst of all possible worlds, but we're in one of the darker timelines compared to all of 'em that are out there, I think. Sean, thank you so much. Alright, thanks guys. We'll catch up with you, Ry. We just got back from the Tribal Broadband Bootcamp, and I think we'll be talking about that in a future episode when I want to bring [00:19:30] maybe Matt on and someone else who is there as well. But do you have a word or two for people about why they should be really excited when that episode comes up?

Ry Marcattilio (19:39):
It was a great time. I mean, I can't think of anything better than seven days in the desert with you, Chris.

Christopher Mitchell (19:48):
Not only that, but physical labor.

Ry Marcattilio (19:50):
That's right. Well, that part that's not so bad.

Christopher Mitchell (19:52):
That was the easy part.

Ry Marcattilio (19:54):
That was the easy, yeah, we got to get there a little bit early and spent some time setting things up, and then a wonderful group of people [00:20:00] came in and we spent three, four days learning together and building human connections, which is just as important as building digital connections. And I look very much forward to that future episode of the podcast.

Christopher Mitchell (20:16):
We built a network. It didn't quite work out the way we wanted to, and people loved troubleshooting the problems that we had because we tried to do it a little too quick to the live event. And despite the heroic efforts of a number of people, never quite did [00:20:30] all the things we wanted it to, but still gave plenty of opportunities for everyone to learn about all the different aspects of this, including you and I. It turns out that pushing a button on the splice machine is not the same as being a good splicer.

Ry Marcattilio (20:44):
That is absolutely true, I think and provided much more organic and genuine learning experiences for folks that, as you said, they were mad about by the end of it, so I'm glad it worked out the way it did.

Christopher Mitchell (20:55):
Yeah. The other thing is the FCC increased the broadband definition a hundred by [00:21:00] 20. I think we all saw that coming. I don't think it changes a whole lot. I assume that it's maybe one or two years before it's woefully inadequate. Already the vast majority of people on Internet access have more than that from, well, I shouldn't say that. They have a faster download connection than that. I believe Comcast just went around with a bunch of increases to try to get people up in the upstream direction. Really. Yeah, and I don't know if you've been tracking that for some reason. I have a phone in which Google [00:21:30] selects news that it thinks I'm interested in, and every time Comcast increases speed somewhere, my phone is like, Chris, you got to know about this

Ry Marcattilio (21:38):
Comcast advertising dollars going to good places. I guess I'm still stuck on 20 megabits on this charter connection, although my download speed has increased. The real problem is that every night between maybe 10 and 11, I get about an hour and a half of terrible latency issues here on this charter connection in [00:22:00] Southern Minnesota. And no matter what they do, it just seems to persist.

Christopher Mitchell (22:04):
Yeah, that's fascinating. I mean, this is where we talk about the more points of failure on the cable network than a fiber network.

Ry Marcattilio (22:12):
Yeah, absolutely. But I guess at the end of the day, it's nice that the FCC is doing something with their time, although as you said, it is practically irrelevant for the vast majority of households on cable connections anyway, and functionally irrelevant for the BEAD program since NTIA set that [00:22:30] a hundred by 20 threshold already for the BEAD dollars, and so, yeah.

Christopher Mitchell (22:36):
Yeah. And another news, Longmont is expanding to another couple of neighborhoods that have been wanting it outside of town. These are areas that are not a part of Longmont proper, but are served by the Longmont electric utility. So that's exciting as we see a number of these municipal networks starting to serve more of their neighbors, I think that's really exciting for growth.

Ry Marcattilio (22:59):
Yeah, [00:23:00] it's nice to see them not just sitting still and being comfortable with the status quo and all the success that they rightly deserve accolades for, but continuing to push forward and bring service to as many households as they can.

Christopher Mitchell (23:12):
Yeah, because it would be very easy for the leadership to just say, let's just sit here and let the money roll in. They've paid almost all their debt off, if not all of it by now. I forget exactly when they were scheduled to. I think they might have one of their sources of funding still, but they've paid most of their debt off. They could just sit there and they could [00:23:30] roll around in cash in their head if the network operating center if they wanted to, but they're going to take risks and keep investing. And I think that's really good for the citizens and residents of Colorado

Ry Marcattilio (23:43):
And a testament to the fact that those people, they must hear them clamoring for better service or alternative service options every day. Yeah.

Christopher Mitchell (23:51):
Yeah. Well, thank you, Ry. I hope that you have a wonderful March Madness. I think there's 32 games between when I'm recording this and when people will [00:24:00] hear it, and I hope that those are 32 wonderful, wonderful games. I'm looking forward to them myself.

Ry Marcattilio (24:05):
Do I still have time to get a bracket in?

Christopher Mitchell (24:07):
You've got a few hours left. Yeah.

Ry Marcattilio (24:08):
Okay. I'm going to go see what Chat GPT has to say about that.

Christopher Mitchell (24:11):
Alright. Thanks, Ry.

Ry Marcattilio (24:14):
We have transcripts for this and other podcasts available@communitynets.org slash broadbandbits. Email us@podcastmuninetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is at Community Nets. Follow community [00:24:30] nets.org stories on Twitter, the handles at muni networks. Subscribe to this and other podcasts from ILSR, including Building Local Power, local Energy Rules, and the Composting for Community Podcast. You can access them anywhere you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter@ilsr.org. While you're there, please take a moment to donate your support in any amount. Keeps us going. Thank you [00:25:00] to Arnie Sby for the song Warm Duck Shuffle, licensed through creative comments.