Internet Broadband Stamps??

Former FCC Commissioner Deborah Taylor Tate is back with a vague plan (PDF) to get Big Government away from “dictating what Americans ‘should’ get or what is ‘best for them'” when it comes to broadband. Forget setting mediocre targets, like the “4Mbps for all Americans by 2010” goal of the National Broadband Plan. Instead, just give people vouchers for really crappy broadband service and the problem will take care of itself.
Think of this as food stamps for broadband, or in Tate’s words, “broadband stamps.”
The idea is to give low-income Americans a broadband voucher that they could use to order a “minimum broadband package,” with “minimum” in this case meaning “enough ‘bytes’ to surf the Web and send e-mails to family members.” Tate wants to make sure that this “circumscribed” broadband offers only rudimentary Internet access so that those who want better service will put some skin in the game and add their own money.
If, say, poor people want to send e-mail to people other than their “family members,” they can “contribute their own hard earned cash to get a gourmet selection that might cost them a little more, or even an even [sic] more expensive ‘all you can eat’ bundle of services.”
This approach could certainly provide basic connectivity to those too poor to get broadband, but one of the big problems (especially in rural areas) is that those with the need and the cash for broadband simply can’t get the access they want. When satellite or high-priced 1Mbps DSL are your only options, you certainly aren’t participating in anything resembling “broadband.”
Tate thinks her idea would solve this problem, too. Some critics have complained that not having broadband available in some areas is akin to not having real grocery stores—a real problem for both rural and some poor urban residents. “With the prospect of these new subscribers,” Tate writes, “companies might find a business model that would also incentivize the deployment of ‘fast food’ (faster broadband speeds) in rural, remote, and low income areas.” (Try to ignore the fact that “fast food” is the last thing that the “build more grocery stores” crowd wants to see.)
This, to put it mildly, is dubious. People too poor to afford broadband in the first place are unlikely to sign up to the lucrative “triple plays” that every cable and telco is desperate to offer. Selling a few more super-low-cost “circumscribed” connections is not the sort of windfall that will tempt companies to invest in new central offices or fiber-to-the-node or whatever else might be called for to increase speeds.
We already see entire communities so frustrated with big Internet providers who won’t increase speeds that they have gone and built their own fiber networks. And these are towns full of people ready to pay up; those with less money aren’t going to spur massive broadband investment by using their “broadband stamps” to get the cheapest access tier on the ISP menu.

I have a terrific new idea…

The piece is an odd attack on “left-leaning organizations” who offer “unfounded criticism” about America’s awesome broadband options. Tate says that, instead of complaining, they should “start building more grocery stores.” So Free Press can only criticize government ISP policy if it’s willing to build and run its own rural/poor urban ISP? Seriously? In a market without regulated unbundling and with natural monopolies?
But the oddest idea is the entire premise that we need to stop setting government-mandated baselines and instead just pass out “broadband stamps.” Tate says “perhaps” we could do this instead of “new indiscriminate broadband spending initiatives.” After all, we already subsidize some low-income phone service this way through a program called Lifeline.
It’s odd because this idea isn’t some kind of speculative proposal that Tate has just conjured up; it’s explicit FCC policy. Looking at the National Broadband Plan, it doesn’t take long to stumble across recommendation 9.1: “The Federal Communications Commission (FCC) should expand Lifeline Assistance (Lifeline) and Link-Up America (Link-Up) to make broadband more affordable for low-income households.”
The Lifeline and Linkup programs helped “increase low-income telephone subscribership from 80.1 percent in 1984 to 89.7 percent in 2008” and currently cost about $1.4 billion per year. The FCC wants to extend these discounts to any service that includes broadband.
But, again, these programs mean nothing for people who can’t get access, which is why the FCC mandates universal service and sets performance minimums. The programs would never have had the same success without that expensive High-Cost Fund support (though these payments are in dire need of reform), and the FCC is taking the same approach to broadband. Far from telling Americans what is “best for them,” the FCC already supports Tate’s idea to allow a choice of provider and a choice of speeds. Where it parts company is its desire to set a modest baseline for service of 4Mbps a decade from now so that all Americans can get access to the ‘Net—and do at least a bit more than e-mail their family members and browse a static World Wide Web.