Making Policy Connections

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On the football field, the red zone is the all-critical final 20 yards. It’s crunch time. The field is shorter but the last few yards can be the hardest to gain. What worked to get into the red zone doesn’t necessarily get you past the goal line. It takes fast, short plays, teamwork, and a new playbook.

We’re deep in the red zone when it comes to making access to broadband nearly universal in California. Internet access speeds and availability have grown rapidly. Upwards of 96 percent of Californians can get internet access speeds of 10 Mbps or higher where they live, which puts us inside the 4-yard line.

Just because broadband is available doesn’t mean that all use it. However, more than 80 percent of Californians live in households with broadband access, and even more use the internet at school, work, or libraries. So in terms of getting people to use the internet we’re also in the red zone, if just barely.

We’ve marched down the field at an astonishing pace. Though the modern internet began only a quarter-century ago, its adoption level – an 84 percent rate across the United States – after that brief time is virtually unprecedented in the history of technology. For the telephone, it took 25 years to reach just 10 percent market penetration. Television reached only 26 percent adoption in the same amount of time.

Our question now: How do we get through the red zone and make broadband even more widely used in California? Public policy can play an important role, but it won’t if the rules and regulations focus on last century’s phone network. California must consider a new playbook by modernizing its policies to encourage widespread use of, and investment in, advanced technology.

As broadband takes over, traditional voice landlines have declined 8.1 percent a year in California since 2004, with that trend accelerating recently. Residential consumers dropped nearly 20 percent of their “Plain Old Telephone Service” (Pots) lines between 2012 and 2013, shedding more than a million lines. Traditional voice service is quickly approaching irrelevance in most of the market. In fact, fewer than one in 10 of California residential voice lines are now Pots. Yet, many of California’s rules and regulations are geared toward supporting that outdated technology.

Wrong focus

There’s a cost to not orienting our policy toward the future. Californians in low-income households are 20 percentage points less likely to have broadband at home than the statewide adoption rate. However, if only 116,000 low-income households a year over five years started using broadband, we’d achieve parity with households above the poverty rate. Encouraging companies to migrate consumers away from Pots to new technology such as broadband and voice over internet protocol (VoIP) is key. So is modernizing California’s universal service programs. There’s no reason why California’s “Lifeline” program, which lowers the cost of communication for low-income households, should apply only to phones when everybody knows the internet is the future. The federal Lifeline program was expanded to include broadband last month – now it is California’s turn to call that play.

Another smart move would be creating policies that encourage private investment in advanced networks and focusing public investment on getting internet access to communities that are unserved. For example, the California Public Utilities Commission manages a fund to invest in high-speed internet access for rural communities. Such programs benefit more than the direct recipients; a recent study of mine shows that as many as 17 jobs can be created throughout the economy for every $1 million invested in broadband infrastructure. However, the $315 million fund has so far directed only one out of every 20 dollars to unserved communities. This is imprudent and inefficient. Rural communities that don’t have access should be the priority. Subsidizing faster speeds for those that already have access is not putting the public’s money to work where it can create the most benefit.

Getting high-speed internet access into the hands of more Californians is a worthy goal. We use it at home, at work, and everywhere in between. Broadband propels the economy forward. We’re a few smart plays away from making broadband nearly universal in California. Now’s the time to focus on gaining those last few yards.

James Prieger is an associate professor of public policy at Pepperdine University’s School of Public Policy.

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