The problematic aspect of the strategy is that word “wireless.” Official D.C. is doing the same thing hundreds of elected officials did in 2006 – advocating a great set of significant, attainable economic goals, but betting on the weaker technology horse to carry us across this finish line.
Politicians nationwide glorified the power of WiFi to produce a host of economic outcomes, from attracting new companies and making local business more profitable to keeping college grads from leaving town. Soon every city and hamlet had to have a WiFi network.
In 2007 communities woke up to the fact that WiFi was inadequate for enabling the kind of computing tasks required to achieve the economic outcomes promoted. Data pointed to wireless as broadband’s Best Supporting Actor. For example, 9 percent of respondents to my 2007 national survey of economic development professionals found wireless had a direct impact on attracting new businesses to their area, and 13 percent saw a direct impact making local businesses more profitable. However, 24 percent and 21 percent respectively saw wireline networks attracting new businesses and making current ones more profitable.
My September 2010 survey revealed similar disparities on the role of wireless versus wired networks. Respectively, 37 percent and 29 percent of respondents believe wireless directly impacts attracting new businesses and making local companies more competitive. 55 percent and 40 percent believe fiber will produce these respective outcomes.
When you analyze the dozens of broadband networks producing the economic outcomes today that some expect our national strategy to achieve in the future, these frequently are community-owned fiber networks. The President wants our strategy to replicate the successes of Ten Sleep, WY’s muni cooperative network. However, Ten Sleep’s network is fiber while our strategy is wireless-centric. Their network runs at 20 Mbps with a much higher potential speed. Our five-year goal is 4 Mbps.
DC policy people are enamored with wireless. With this fixation, much money and time will be lost. In those communities whose successful networks attract companies with new jobs, propel local businesses into global markets and transform education, wireless usually is just part of the picture. They understand that businesses and other job-producing organizations require fiber in the next three-to-five years.
The Universal Service Fund has become monstrously complex. But the net of USF reform is this. Everyone in America who pays a telephone bill collectively put about $4.5 billion A YEAR into a High Cost Fund that goes to a group of telcos to get telephone services to rural individuals. AT&T and Verizon get the lion’s share. USF reform seems headed down a path to give that $4.5 billion to a smaller group of telcos and ISPs to provide broadband (mostly wireless) to these constituents.
If you want to replicate the economic successes of Ten Sleep (pop. 300), you need to blow up the whole USF process. Structure a $4.5 billion grant program that encourages local telcos such as Clearwave Communications and Hill Country Telephone Cooperative to partner with communities to create wired and/or wireless broadband plans to boost local economies AND connect the underserved. Make community networks also eligible for these funds. Require applicants to share network buildout costs with the Feds. Require local communities sign off on the validity of the plans regardless of who owns the network. Keep governors’ involvement on tight leashes.
If you’re serious about using broadband to achieve those great economic outcomes, wireless can’t be the tail that wags the dog. It’s an extension, a steppingstone to a greater solution, sometimes the only affordable option. Ultimately, communities must have a bigger role in determining which technology has what role.
Craig Settles is a broadband industry analyst and business strategy consultant. You can follow him at @cjsettles on Twitter.