What do rural Minnesotans think? Broadband is essential!

Yesterday the Minnesota Farmers Union unveiled their report – What Do Rural People Think? It is the distillation of 14 conversations in 14 rural communities held between March 27 and April 6, 2017.

Here’s the quick summary (broadband is #3!)

Since the 2016 national, state, and local elections, there seems to be an ever-present question on the minds of policymakers, elected officials, the media, and organizations of all kinds: What do rural people think?

  • $43,429 per year is too much to pay for health insurance that you don’t use.

  • St. Paul politicians need to come out to rural Minnesota to listen to us about what works, and what doesn’t work, before they tell us what to do with our farms.  Rural people need to be consulted, not told.

  • Broadband Internet is an essential utility, like electricity.  It has to be affordable and available throughout all rural areas if we are going to survive and thrive.

  • Rural Minnesota does not deserve to be left behind on transportation, roads, bridges, healthcare, wages, and everything else.

  • We need to be able to pay rural health care workers more for their work in nursing homes, homes, and healthcare facilities. Right now, big box stores pay more than health care jobs can pay them. It’s our people being taken care of in those nursing homes.

  • Politicians need to really get out here and listen to us; not listen and tell; just listen and hear.

And here is what they say more specifically about broadband:

Broadband in rural Minnesota is an essential utility

High speed broadband internet is not a luxury for family farmers and rural communities.  Without it, farmers and communities cannot retain residents, or be a part of the world’s economy.  Additionally, without adequate internet, youth cannot compete with the rest of the country, to complete homework or education programs.  Farmers need it for everything ranging from working with FSA to communicating with state government to running their farm’s operations.  As more than one person indicated, broadband internet needs to be considered an essential utility, and significant state and federal funding is required in order to make it universally available.

Tell us how much you pay per bit and byte for your broadband.

Last week I wrote about Minnesota Broadband Coalition’s cool tool that helps determine the price of broadband by speed (bit) and data usage (byte). Here’s a quick visual reminder:

Today Jim Hickle from Gigabit Minnesota sent me info on their numbers:

I think Jim had a good idea of sharing the info. I want to invite other providers to do the same. The Coalition has a broadband cost analysis spreadsheet that you can use to calculate the unit cost of your broadband.  Email it to me (atreacy@treacyinfo.com).  Or complete this form with the info you have. I’ll compile all submissions  and we can share a more complete picture of comparative broadband pricing.

What do Americans think about broadband policies that encourage broadband adoption?

Pew Research just unveiled the results of their latest survey looking at how folks feel about policies intended to encourage broadband adoption. Turns out a majority of folks support municipal opportunity..

A substantial majority of the public (70%) believes local governments should be able to build their own broadband networks if existing services in the area are either too expensive or not good enough, according to the survey, conducted March 13-27. Just 27% of U.S. adults say these so-called municipal broadband networks should not be allowed. (A number of state laws currently prevent cities from building their own high-speed networks, and several U.S. senators recently introduced a bill that would ban these restrictions.)

There’s a more mixed reaction to government subsidies to support low income access to broadband…

At the same time, fewer than half of Americans (44%) think the government should provide subsidies to help lower-income Americans pay for high-speed internet at home. A larger share (54%) says high-speed home internet service is affordable enough that nearly every household should be able to buy service on its own.

There’s more agreement again on the need of broadband…

These policy debates are occurring at a time when roughly nine-in-ten Americans describe high-speed internet service as either essential (49%) or important but not essential (41%). Only about one-in-ten Americans say that high-speed internet access is either not too important (6%) or not important at all (3%).

Republicans and Democrats tend to agree that broadband is important, but Democrats are more likely to say it is essential: 58% of Democrats and Democratic leaners describe broadband in this way, compared with 38% of Republicans and Republican leaners. A similar split is evident by race and ethnicity, with blacks (55%) and Hispanics (61%) more likely than whites (45%) to say that high-speed access at home is essential.

Current broadband users also place a higher value on high-speed access: 52% of current users describe the service as essential, compared with 36% among non-users. In fact, roughly a quarter of those who do not have broadband in their homes say that high-speed internet service is either not too important (15%) or not important at all (10%). Previous Pew Research Center surveys have found that broadband users see greater value in high-speed access at home than non-users, although there is evidence that attitudes among non-users have been growing more positive in recent years.

How much do you pay per bit and byte for your broadband? New comparison tool looks at speed and usage

Grocery stores put “price per ounce/serving” labels on product shelves. It has changed how I shop. Do I always buy the cheapest? No. Not all cookies are the same. But am I better informed? Yes. The National Broadband Plan promised similar tools with their Broadband Speed and Performance Digital Labels but those were based on performance – not cost.

The Minnesota Broadband Coalition has been working on a comparison of broadband pricing based on speed (bit) and data usage (byte). The Coalition is hoping that this information can help people — both consumers and policymakers –make more informed choices.

What does this mean?

There are some extreme differences – especially with satellite. You can see that the satellite service is more expensive for both bandwidth (speed) and data usage. The satellite price for data usage, at $5 or $6 per GB (gigabyte) compares unfavorably to the dimes and nickels charged by landline providers. For all providers except satellite, the lower bandwidth services have the highest price per Mbps (megabit per second).  In other words, the more you use, the less you pay per unit. There are two providers have no data cap for their Gigabit service.

Sources now put monthly average household data use at 190 GB (gigabyte) and that number is constantly growing. For rural residents that use data for school, business, health care or other data-heavy activities, it is clear that satellite is an expensive or very limiting broadband option.  It is, however, available everywhere, for those who can afford it.

The Coalition has created a broadband cost analysis spreadsheet that you can use to help calculate the unit cost of your broadband.

Mini-Lesson: Reminder on bits (speed) versus bytes (data usage)

  • Mbps is a measure of speed – megabits per second.) Speed provides the capacity to interact online. The FCC has a guide to help track speed requirements by online activity. For example, streaming an HD video requires 4 Mbps connection (download). To figure out your household’s speed requirement, you’ll have to consider all the users of broadband – every laptop, smartphone, ipad and the Internet of things for each member of your household or office.  Think about it – your family is probably using more than one device at the same time.
  • GB is a measure of how much data you’re using – gigabytes. For example, an HD movie may be 3-5 GB.  It’s like a cup that gets filled. Depending on your provider, you may pay more if you overfill your cup, your connection maybe slowed down if your cup gets filled or your provider may not have data caps (aka data allowances) so you can interact online (download or upload) without limitations. Many people have experience with usage on mobile contracts – but cellular providers aren’t the only ones that track and charge by usage.

Need more? I wrote a longer piece on bits/bytes and average household use in December.

Latest Digital Divide report is out – MN digital divide index is increasing

The Digital  Divide Index looks at access to broadband and socioeconomic characteristics of a community to determine the propensity toward a point-based gap. The higher the number, the higher the gap. (When I did County Profiles I included the DDI number – this report updates that number.)  In general places with a higher DDI umber need more attention – but diving in a little bit it can be valuable to see the comparison between access and socioeconomic characteristics to figure out what kind of attention. It seems simple to say – invest in infrastructure where those numbers are high and training, access to computer, promoting technology where the socioeconomic gaps are high – but it’s only simple when there’s a benchmark like this to help gauge.

You can see how Minnesota measures up on the maps below – red areas may be in trouble – green areas are doing well.

Here is how MN has changed since 2014 (the current is 2015 stats).

2014 2015 2014 2015 2014 2015
Minnesota 28.69 29.51 58.84 62.06 38.09 41.92

We’ve seen a slight increase in the DDI, which isn’t a good thing. (Lower is better for SE and DDI.)

Looking at the individual counties, the DDI score improved for only 12 counties:

  • Becker
  • Beltrami
  • Cass
  • Cook
  • Fillmore
  • Hubbard
  • Itasca
  • Lake
  • Mahnomen
  • Norman
  • Red Lake
  • Sibley

(See how all MN Counties did.)

The value of this information will increase over time. For example – today what we see when we look at infrastructure (INFA) are areas that need better broadband and when we look at socioeconomic (SE) characteristics include a large demographic of residents to traditionally have a lower tendency to adopt broadband. Unfortunately the data is from 2015 – so that data does not include recent upgrade spurred by the Border to Border grants or private sector upgrades as we’ve seen with Paul Bunyan and will see this year with Mediacom. But those impacts should be obvious as soon as the data is collected (from federal resources).

Knowing where the infrastructure is (and isn’t) is valuable for policymakers who are willing to invest in improvement. It’s also valuable to residents and businesses that are looking to relocate. The impact of that knowledge will show up – more slowly on the socioeconomic (SE) scale. Subsequently, there may be a trickle down effect on the SE ranking of counties inversely correlating with access to broadband. The great access to technology – the lower gap.

We need a new way to measure economic impact of the Internet

The Internet Association recently published a white paper called – Refreshing Our Understanding of the Internet Economy. It’s claims that we don’t have a good way of quantifying the impact of the Internet.

The research is funded by of companies made possible by the Internet (Amazon, Uber, Google…) and they make a good point.  Finding a better way to measure the impact would make it easier to create policies that encourage growth and minimize unintended consequences.

Here’s an interesting idea that helps illustrate the need…

Perhaps a more useful approach hinted at by du Rausas et al. (2011) is to consider the internet economy as a unique market (i.e. the same way we would a sovereign nation). They estimated that in 2009 the internet would have been one of the 10 largest national economies in the world, larger than Canada, Spain, and many other large developed economies, implying a global GDP contribution of over 2.1%. And while not entirely applicable, the approach does fit many of the economic activities in the internet. Recent years have seen the development and stabilization of new currencies (bitcoin and other cryptocurrencies), the development and sale of new territory (domains and sites), new production and distribution infrastructure systems (apps and network platforms), new communities and culture (social networks), and the collection and utilization of new forms of resources and commodities that can be mined and processed into economically useful items (data, APIs, and more).

This is not to suggest that the internet should be considered a country, but it does illustrate that the types of goods and services developed via and available through the internet should, at a minimum, be given more attention than they currently receive and, as the paper argues, considered a unique class with a more sophisticated approach of incorporation.

It’s a conundrum – but getting our arms around it will help us prepare. Even without the most accurate approach, the figure below (from the report) indicates that the Internet sector contributes 6 percent to the Gross Domestic Product.

Rural counties with the highest levels of broadband have the highest levels of income

Agri-Pluse is publishing a series of articles – “The seven things you should know before you write the next farm bill.” Last week their article on Rural Development touched on the importance of broadband – using a Minnesota example…

Bob Fox, a Minnesota farmer and Renville County commissioner says that businesses looking to plant roots in a rural community often ask about the quality of roads first and the speed of broadband, second.

“It just makes a world of difference in what you can do as a business person with that broadband speed,” he told Agri-Pulse. “We have to find a way to get broadband across all of the United States.”

A study conducted for Cornell University’s Community and Regional Development Institute underscores his point. It found that rural counties with the highest levels of broadband have the highest levels of income and education and lower levels of unemployment and poverty.

But according to the most recent Broadband Progress Report, 34 million Americans still lack access to broadband benchmark speeds. This baseline map (below) visualizes broadband access at the county level and identifies connectivity gaps — the lighter the color, the lower the percentage of households with broadband access.

They recognize that reaching those 34 million is tough work…

Building out high-speed broadband in rural areas is not easy or cheap, as Catherine Moyer, CEO of Pioneer Communications, pointed out during a recent Senate Agriculture Committee field hearing.

Pioneer is a local telecommunications provider located in southwestern Kansas, serving a 5,000 square mile area – roughly the size of Connecticut but with over three million fewer people than that state.

“We provide 21,000 total connections to wireline voice, high-speed broadband and video services over a network that utilizes a mix of fiber, copper and coax facilities,” Moyer testified. “On average, we have just over two subscribers per square mile. However, when considering that 81 percent of our customers live in our small population centers, the “density” of our rural subscribers per square mile drops to just under 0.5.

“Put another way, 81 percent of our customers reside in approximately 15 square miles, while the remaining 19 percent reside in the other 4,985 square miles.

One might ask why we serve these areas, she noted in her testimony. “We are the provider of last resort –in addition to legal obligations to serve these consumers and businesses who were left behind long ago when larger companies picked first where to serve. If Pioneer does not provide them now with service, there is no one else available to do so.”

They also recognize that broadband is one facet of rural development. There are many. Agri Pulse seems to be suggesting a united front for building better awareness…

While a wide array of Rural Development programs can offer many options for helping keep farmers on the land and rural businesses growing, this part of the farm bill is often not considered to be a high priority for national farm organizations. For commodity groups, it’s usually something that surfaces after the commodity, crop insurance, and conservation titles.

And even among its most stalwart advocates, congressional staff say that support for RD is often splintered in respective silos. For example, rural water advocates do a great job lobbying for water programs and the same is true with the rural electric cooperatives, advocating for low-interest loans. And organizations like NTCA-The Rural Broadband Association have been actively promoting expansion of broadband.

But during the last farm bill debate, rural advocates say there was not a strong enough coalition of all rural and farm groups “beating the drum” for a more comprehensive approach to job creation in rural areas.