ITIF’s Analysis of Broadband and Affordability Misses the Mark
Thursday, February 11, 2021
ITIF’s Analysis of Broadband and Affordability Misses the Mark
The COVID-19 pandemic has put the digital divide on policymakers’ agenda like never before. It is challenging them to find solutions that meet the urgency of the crisis while building a foundation for sustainable progress over time. This means that policymakers will want to build on lessons learned and explore new approaches. A few ideas they may want to consider include:
- Specifying certain speed, data, and pricing standards for service plans designed for low-income Americans.
- Ensuring that eligibility criteria for discounted offers reach all non-adopting population segments not just (as many currently do) households with students.
- Appropriating funds for digital navigators and digital skills training, something particularly relevant for older Americans just getting online.
- Requiring internet service providers to report progress and face scrutiny if progress stalls.
In contemplating these and other ideas, policymakers may want to look at analysis of broadband adoption barriers – the more reliable the better. Unfortunately, the Information Technology & Innovation Foundation (ITIF) recently published a study entitled “Broadband Myths: Are High Broadband Prices Holding Back Adoption?” that falls short of the mark. ITIF’s argument on the role of the affordability of service in broadband adoption boils down to the following:
- Policymakers risk “tunnel vision” if they pay too much attention to affordability of broadband service, and;
- Broadband prices in the United States are competitive with other nations’, implying that concerns about costs in the U.S. being too high are overblown.
ITIF notes, correctly, that there are multiple reasons why many U.S. households do not subscribe to broadband. But affordability of service plays an outsized role. By suggesting it does not, the ITIF research risks constraining policymakers and other stakeholders as they seek to bridge digital adoption gaps. Moreover, in support of its argument downplaying the role of affordability, ITIF may confuse readers by citing research without the proper context.
1. Cost is the main barrier to broadband adoption
The first research that ITIF cites in its caution against “[m]isundertanding the role of affordability in broadband adoption” is a paper I wrote in 2010 for the National Broadband Plan (NBP). The ITIF piece accurately pulls a quote from it saying that “no single reason stands out” for why some people do not use the internet. Relying on that quote, however, elides one of the study’s central conclusions: Cost was the main reason non-broadband users did not subscribe to service.
The NBP study asked two sets of questions about why people did not subscribe. Respondents first could choose from a list of reasons why they did not subscribe to service. Among non-broadband users (those who did not use the internet at all, those still using dial-up, and internet users without “at home” access), about 50% cited the monthly fee and one-third said they could not afford a computer. Other reasons (e.g., not comfortable using a computer, satisfaction with current service for dial-up users) were not far behind. When asked to cite the main reason they do not subscribe, 36% cited cost (15% pointing to the monthly fee, 10% to the affordability of the computer, 9% the monthly activation fee or reluctance to make a long-term service commitment), 22% cited lack of digital literacy, and 19% cited reasons indicating that broadband service was not relevant to their lives.
The NBP study made a clear finding with respect to barriers to broadband adoption – cost leads the way. But, as the NBP study makes clear, non-adopters have multiple reasons for not having service, even as the affordability of monthly service and computers figures prominently.
In addition, ITIF mischaracterizes Professor Colin Rhinesmith’s work. ITIF accurately quotes Professor Rhinesmith in saying that “persistent poverty” shapes whether people can engage with the internet, which means they face multiple barriers to adoption. However, ITIF neglects a key finding from the Rhinesmith research, which is in fact the first one listed in the study’s executive summary: “Cost continues to be a major barrier to broadband adoption.” This finding rests on the qualitative research that Rhinesmith conducted in the study to understand why people do not subscribe to broadband.
ITIF highlights other reasons for non-adoption thereby minimizing the role of monthly cost in broadband adoption. In trying to highlight the role of digital literacy, ITIF relies on a Pew study that says “having access to the internet does not lead to more online exploration” for 39% respondents. This came from a sample of 112 respondents given tablets to respond to Pew’s online panel – a non-random group that skewed older (nearly all were over age 50) and female by a 2-1 margin. And the study does not point to digital literacy as a reason for its findings.
In another instance, ITIF accurately describes a Pew study that shows that half (50%) of all non-broadband users cite the monthly service fee as a reason they do not have service, though it neglects to point out that a slightly smaller share (45%) point to the smartphone as a reason. When asked to identify the most important reason, about the same number cite the utility of the smartphone (23%) as cite service cost (21%); some 6% cite the cost of a computer. Yet the same Pew study shows that a disproportionate share of “smartphone only” Americans are low-income – suggesting that their choice to rely on a smartphone might have something to do with struggles to pay additional home broadband subscription fees.
2. Cheap but slow is not OK for the poor
The bulk of the ITIF paper is about whether broadband prices in the United States are too high when compared to other countries and concludes that America has “competitive rates.” That must really mean “comparable rates” since U.S. broadband providers do not compete with foreign broadband providers for American customers. The report rightly points out the difficulty in understanding prices for broadband, much less cross-national comparisons. One way to address that challenge is to ask U.S. internet service providers to report their prices to the FCC – something industry has resisted. In any case, cutting through ITIF’s rhetorical fog of describing others’ research as having “brazen methodological flaws” reveals a few curiosities.
First, ITIF references a study from the Organization for Economic Cooperation and Development (OECD) – certainly not an outfit with any particular skin in the game to reach conclusions of a certain sort. The study ITIF cites finds that the United States ranks 32 out of 34 countries in broadband prices. The point of comparison is for service plans with 200 GB limits or have speeds of 25 Mbps or above.
Second, ITIF argues that broadband service plans for entry level are cheaper than other countries. Inexpensive U.S. plans may thus meet the needs of low-income subscribers. This claim cites ITIF’s own study, which in turn footnotes research from the International Telecommunications Union (ITU). A click or two away, though, is this at footnote 47: “Note the ITU measurement for entry-level broadband is 2 Mbps.” That is only 8% of the speed the FCC uses as its threshold for broadband.
3. Unreliable analysis is no help to policymakers
Research offers guidance on how to close broadband adoption gaps. First, discounted internet offerings help. Where they are available, they increase broadband adoption among low-income households at a rate greater than would otherwise be the case. Second, digital skills training has a significant impact on people’s online behavior, increasing (for those who have had training) the incidence of using the internet for education and job search. Third, many disconnected households need computing devices and, during the pandemic at least, computer adoption rates for households with students have increased, often with the help of philanthropy.
Meeting the connectivity gaps that the pandemic has exposed may well challenge the comfort-level of some stakeholders. That does not mean progress is impossible. But progress will depend, in part, on reliable analysis of the problem. ITIF’s Broadband Myths paper falls short of that standard.
John B. Horrigan is a frequent contributor to Benton's Digital Beat and a Senior Fellow at the Technology Policy Institute, with a focus on technology adoption, digital inclusion, and evaluating the outcomes and impacts of programs designed to promote communications technology adoption and use. Horrigan is also currently a consultant to the Urban Libraries Council. He served at the Federal Communications Commission as a member of the leadership team for the development of the National Broadband Plan. Additionally, he has served as an Associate Director for Research at the Pew Research Center, where he focused on libraries and their impact on communities, as well as technology adoption patterns and open government data. Views expressed here are his own.
The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.
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