Connecting America
Broadband Policy Issues and Options for State Legislatures
Pre-Conference Invitational Seminar
NCSL Annual Meeting
Boston, Massachusetts
August 4-5, 2007
Session Date: August 4, 2007
Session Summary: Broadband Case Studies and Best Practices: Connected Nation
By Michelle Larson-Krieg, Intern, Legislative Information Services, NCSL
This summary is provided for information purposes only. NCSL does not endorse any views it contains.
Summary: Brian Mefford and Representative Mark Maddox discussed how Kentucky and Tennessee facilitated broadband deployment and adoption using the Connected Nation model. One of the important features of this model is that it addresses both the supply and demand sides of the broadband equation. The first step is a comprehensive assessment of who is currently offering what broadband services where. Based on the information provided by the assessment, the model then fosters cooperative relationships among state governments, private service providers, and local communities to reach broadband deployment and adoption goals.
Mefford: The Connected Nation Model could be titled “The Power of the Possible: An American Story.” We’ve been encouraged by the fact that the challenges are very consistent from state to state. The opportunities also tend to be very similar. The Connected Nation approach involves moving past the minutiae of the policy debate. Our philosophy is “git-r-done,” and our goal is to find out how to most effectively address broadband deployment and utilization issues.
Some of the interactions that broadband makes possible are very powerful. For example, students in one Kentucky school were able to have a dialogue with holocaust survivor.
Broadband offers the potential to change education, economic development, and healthcare. Small business survival depends on broadband. One woman with multiple sclerosis could no longer expend the energy to commute to her job, but broadband gave her the opportunity to telecommute. Because of this, she is still an active and productive member of the workforce. Connected Nation seeks to maintain focus on the human element and economic development. We want to move beyond the policy debate and focus on getting it done.
In Kentucky, we kept that focus by talking about policy priorities, which were e-health, e-government, e-learning, and attracting high tech industries. The reality was that there was inadequate investment to provide the necessary broadband foundation across the state. In addition, the rate of use was ridiculously low. Some areas had only 2 percent adoption with 100 percent access. We saw this as a two-part challenge, involving both supply and demand.
Taylor County, Kentucky is a small county with a population of around 2000. One day a textile manufacturer, the principle employer in the area, decided to move out. This move resulted in 30 percent unemployment overnight because the community had relied exclusively on that single employer, with no other investment in any other infrastructure. To get the telecommunications infrastructure they needed to encourage economic development, the community got together and talked to broadband service providers. By working together, the community was able to build a good broadband infrastructure base.
When a company came along and saw buildings and infrastructure in place, they chose to locate in Taylor County. Amazon.com led, and other businesses followed. One of these was a travel company that moved their call center to the community.
There are 120 counties in Kentucky, and several of them face similar economic risks. The state knew they couldn’t afford to be reactionary, so they chose to be proactive.
Connect Kentucky adopted a public-private approach that includes private providers, members of the community, and other stakeholders. Our primary goal is full broadband deployment by 2007. Second, we want to dramatically improve the use of computers and the internet. Third, we want to create e-community leadership teams throughout the state. These teams are representative of a cross-section of our society – business, agriculture, education, health, and others. Fourth, we want to ensure that we create a friendly environment for continued technology investment.
The first step in the process was to conduct a broadband inventory to map all of the existing providers and available services. We then inverted the map and focused on filling the gaps. This approach allowed targeted discussion from the beginning. Within unserved areas, we knew how likely citizens were to adopt broadband along with their price sensitivity, and could paint a vivid picture of the market for providers.
The e-leadership teams are the most unique aspect of the Connected Nation model. They encourage local engagement, local responsibility, and local ownership. To create the teams, we bring people from the community together for a kick-off meeting to discuss plans. We generally see 100 people attend the initial meeting, even in rural areas.
We look for people to serve on the e-leadership teams who represent the community’s various sectors and who are committed and willing to work. Time after time, there are 25-30 people who are willing to put forth the effort. It is an exciting process.
Through the e-leadership teams, we determine where the community is today and how they could better use technology—both what’s available today and what’s coming down the pike. We then help the team write a tactical plan that documents where they are, where they want to be, and how to get from here to there. We then manage the project to deliver solutions. It is a very deliberate approach that works supply and demand at the same time.
Because of Connect Kentucky, the state went from 60% to 95% household availability of broadband service. This change affects lots of people. There has also been an increase in use. Kentucky’s adoption growth rate appears to lead the country.
The positive results include significant job growth. Before Connect Kentucky, the state was bleeding IT jobs. Within the last two years, 14,500 tech jobs were created.
From 2000 to the present, the brain drain Kentucky was experiencing has been reversed. Before 2000, 50 percent of the individuals who earned a Ph.D. in Kentucky left the state. Now, 70 percent of those awarded Ph.D.s are staying. In fact, more college graduates at all levels are choosing to stay. Ninety-five percent of Kentucky natives who graduate from in-state colleges now stay. All of the indicators that Connect Kentucky set out to impact have been positive.
Connected America wants to transfer those results to other states. Although it requires ingenuity, creativity, and hard work at the community level, the Connected model is highly transferable. There are examples of the model being successfully used in California, Alabama, Massachusetts, and elsewhere. Tennessee is off to a good start. Representative Charlie Hoffman was key to the success of the model in Kentucky. It is very important that state legislators be on board.
Maddox: In Tennessee, the idea to actively encourage broadband deployment and adoption got started with a recognition that the economic environment was changing. Shoes, shirts, pajamas, light fixtures, plastics, parking lot logs, flour, blue jeans, and chewing tobacco were all things that used to be made in my county. These items are no longer produced there. Opportunities that were available to previous generations are no longer available. I became a Technology Coordinator because I was the only one who knew anything about computers.
There is a disconnect between what is possible at school and what is possible at home. A dial-up connection isn’t good enough for a kindergartener. Broadband deployment is important because kids are going to drive it, they need it, and parents are going to get it for them.
Senator Roy Herron established the broadband regulatory task force one and a half hours after finishing Thomas Friedman’s “The World Is Flat,” a book that explains how technology, and specifically telecommunications, have leveled the international playing field. Fourteen people initially came on board, and we wanted more people to commit on the front end. We saw that broadband had the power to create jobs, transform education, and improve the delivery of government services. To begin, the task force had to first figure out where were, where we wanted to be, and how we were going to get there.
One of the first things we discovered was that providers weren’t open about sharing information. Then Brian Mefford came into our lives. The task force thought that Kentucky had found the way to go.
With Connected Tennessee, providers stepped up to develop a map to locate customers. E-community technology committees were formed and they developed and implemented tactical plans over the next several months.
We are pleased with the results. A medical transcriptionist in Weakley County is now able to do her job entirely over the internet. A single mom is employed by a call center that requires a college education. Other call centers are looking for employees. A customer service rep for a California company is also able to work from home.
We still struggle with affordability, computer access, and DSL service availability. But we are on the right path.
Q & A
Q: The No Child Left Offline project that delivers computers to underprivileged Kentucky middle school students is an important piece of Connected Kentucky. We need to make sure that children are able to participate fully in their education.
Mefford: Connected Kentucky uses a data driven, pro-active approach. We want to understand at a granular level why people aren’t using broadband. In Kentucky, we found that the top reason people weren’t using broadband more was limited computer ownership. A computer company gave us the equipment and Microsoft donated software so that we could put refurbished computers in the homes of underprivileged eighth graders. In most impoverished counties, people celebrate the arrival of the computers.
Q: Despite opportunity costs and externalities, all we need to do is give each child a computer? We need to approach this idea with a grain of skepticism. Access to information does not constitute an education, increased bandwidth does not mean that you’re going to be an educated person. What are the issues of concern with computers, broadband, and education? Have policy makers paused to think about the consequences?
Maddox: Having a computer doesn’t mean you’re educated, but having a chalkboard doesn’t mean you’re a teacher. It is still worth it to try something new. Sure, it might not work, but you have to have tools.
Mefford: The changes that have occurred in Kentucky classrooms have been dramatic. The impact has shaped the approach, and conviction toward that approach. The quality of the interaction allows students access to compelling educational resources in a new context. For example, one class held an in-depth conversation with holocaust survivor. This interaction provided students with a better understanding than a textbook would provide. Contextual education has a lot of value. Another class used broadband to study masks in African culture. Educational technology includes classrooms equipped with computers, smart boards, overheads—there is no guarantee that any particular technology will work. A philosophical alignment and understanding of how tools can be used can make classroom technology more effective.
Q: Regarding mapping on the supply side, how are providers participating? What is the private sector doing? What tools is Tennessee using to provide incentives to the private sector?
Mefford: Providers contribute service-level data, Connected Nation then creates the map. The map is a useful tool to identify gaps. We have found that providers are eager participants. They have responsibilities from a business standpoint, but they want to participate. Providers are able to use the map to prioritize their investments.
Maddox: Why a public-private partnership? This approach encourages providers to give you the information that you need to move forward. We thought that rural areas weren’t getting service, but the map proved it. Every rural county had gaps in service.
If the Broadband Task Force had collected data from providers, sunshine laws would have made the information public. Providers were hesitant to participate because they feared regulation. The government couldn’t get the information, but quasi-governmental agencies aren’t subject to sunshine laws.
In Tennessee, the Department of Finance and the Administration reached the same conclusion. The legislative and executive branches got to the same place at about the same time. Money was granted to Connect Tennessee to gather data.
Mefford: Public agencies all come to the table at the same time. Education, healthcare, and others are all involved and provide leverage. With regard to cost, the state has spent $7 million, and the private sector has spent $700 million over the last three years.
Q: Once the gaps are identified, how do we close those gaps? How do you get broadband into the areas that need it?
Maddox: Tennessee passed legislation to provide incentives to close the identified gaps.
Mefford: There is a business case to provide service to 95 percent of citizens. In Tennessee, a business case can be made for nearly 100 percent of citizens just because more detailed market intelligence has been provided. The map has opened up discussion and providers have offered to go into unserved areas.
It has been eye opening to find that companies don’t know where service is not being provided. Our maps overlay household density, and this allows the lights to flip on and for providers to get low-hanging fruit. That is only part of filling the gap. Demand side work is the other piece. This involves improving take rates in areas where providers already are. We work at the community level to improve take rates (household adoption). Higher adoption rates change the business case for providers. They have more money from previous investments and can count on higher take rates in new service areas.
Mefford: Local telco exchanges historically provided the best service. Now larger providers also have to step up to the plate.
Q: For areas with lower household density and rural service, how do you make the case to provide service to people living in the countryside?
Mefford: The last three percent will be extremely difficult to serve. Satellite is part of the solution, but cost is a consideration. We may implement programs to offset satellite costs. So far, expenditures have been almost nearly all private.
Q: What is the definition of broadband? What about price?
Maddox: We recognize that the FCC definition of broadband is totally inadequate.
Mefford: We see plenty of states caught up in the definition of broadband. In the meanwhile lots of people remain without service. The map provides a benchmark, and we can start by knowing what is there now. What is relevant to a rural household may be different than what is relevant to an urban resident or a business. More is better, faster is better. We don’t define broadband for a community, communities make that determination on their own. The definition depends on local ownership and local engagement.
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