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Broadband Connectivity in Rural America

In what is called the "Digital Divide" broadband connectivity in rural America is sporadic, prohibitively expensive, and nonexistent. Those of us living in or around metropolitan areas have a choice of provider services ranging from cable modem, telephone line DSL (digital subscriber line), fiber optic cable, WiMax, fixed wireless, satellite, and broadband over existing power lines (BPL). A study done by the Pew Internet and American Life Project indicated that while broadband adoption is growing in urban, suburban, and rural areas, broadband users make up larger percentages of urban and suburban users than rural users. Pew found that the percentage of all U.S. adults with in home broadband is 52% for urban areas, 49% for suburban areas, and 31% for rural areas. (Kruge, 2008)
 
For service providers deploying equipment is costly making the return on investment low due to the population density.  As pointed out in the same study, the greater the geographical distances among customers, the larger the cost to serve those customers. There is often less incentive for companies to invest in broadband in rural areas than, for example, in an urban area where there is more demand (more customers with perhaps higher incomes) and less cost to wire the market area. (Kruge, 2008)  Having multiple choices creates competition which keeps the price of connectivity within reach. As pointed out in the US government's National Broadband Plan “In general, broadband subscribers appear to have benefited from the presence of multiple providers. Broadband providers have invested in network upgrades to deliver faster broadband speeds and enter new product markets - cable companies providing telephony and telephone companies offering multichannel video.” (Broadband Innovation and Competition Policy, 2011) The price of connectivity in rural areas runs higher than its urban counterpart. For example, a DSL plan for a user in Tox Alaska topped in at 512K up and down with a 10 GB monthly bandwidth allowance for about $180/month with a $50 charge for the Wi-Fi modem. Alternately, the satellite plan starts at $700 for the dish and $180/month for speeds of up to 1.25 MB up and down. (Sherman, 2009) Similar infrastructure costs are associated with WiMax deployment which some see as an alternative to Wi-Fi for rural areas. In a recent study by NetworkWorld describing the potential issues surrounding WiMax deployment “The terrain is very mountainous, it has tons of trees. It's not a cookie-cutter infrastructure by any means and building it in that environment will be the most challenging aspect we deal with.” (Reed, 2010)

The benefits of connecting more of our rural citizens would be huge. Consumerism, distance learning, and ecommerce for agriculture could bolster a sagging local economy. According to estimates, by relying on wireless broadband and therefore, providing 100% of coverage, 116,862 jobs can be created or saved between 2011 and 2014, while on average, the median income per county in those states could be increased by $1,201. (Katz, Avila, & Meille, 2010) Consider how farmers and agriculturalists could benefit from real time trading information regarding commodities, B2B and B2C marketing. Additionally, law enforcement, schools, libraries, hospitals and emergency services can all benefit from a stable, cost effective, and robust broadband connectivity. 
  • Broadband Innovation and Competition Policy. (2011). Retrieved 10 2011, from National Broadband Plan Connecting America: http://www.broadband.gov/plan/4-broadband-competition-and-innovation-policy/
  • Katz, P. L., Avila, J., & Meille, G. (2010). RCA's Economic Study: Economic Impact of Wireless Broadband in Rural America. Retrieved oct 2011, from RCA The Competitive Carriers Association: http://rca-usa.org/advocacy/economic-study/economic-study/914276
  • Kruge, L. (2008). Digital Divide / Rural Broadband. Retrieved oct 2011, from Cyber Telecom: http://www.cybertelecom.org/usf/dd.htm
  • Reed, B. (2010). Broadband stimulus brings WiMAX to rural U.S. Retrieved 10 2011, from NETWORKWORLD: http://www.networkworld.com/news/2010/102510-wimax-broadband-stimulus.html
  • Sherman, A. (2009). Connectivity Issues From Rural Work Places. Retrieved nov 20, 2011, from Giaom: http://gigaom.com/collaboration/connectivity-issues-from-rural-work-places-part-1/

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