US Broadband Infrastructure: Costs to Close the Digital Divide

By Radhika Shivaprasad, Heather Sabel, Samuel Kornstein

COVID-19 has increased the importance of digital resources as essential services move online. In the face of this landscape, policymakers are focused on closing the digital divide by ensuring Americans can affordably access reliable internet connections.

We recently published a report in collaboration with ACA Connects that evaluates how much it would cost to ensure that all Americans can access reliable fixed broadband.

Policymakers can address broadband needs with funding under discussion

Cumulative costs to fund gigabit - all 99 million locations: $117B to $198B

The amount of funding required to fund gigabit deployment to all unserved areas depends on how ‘unserved’ is defined.

Funding gigabit service for all ‘unserved’ areas according to the FCC’s current definition of broadband (25/3 Mbps) would cost $20B – $37B, which would be feasible using the current levels of funding under discussion (i.e., $65B).

Some policymakers have proposed classifying all areas that lack access to 100/100 Mbps service as ‘unserved’. This definition would categorize 82 million locations nationally as ‘unserved’, and it would cost approximately $106B – $179B to fund gigabit service to all of them. This amount far exceeds funding proposals for broadband deployment currently under discussion.

In addition to funding deployments to close the broadband availability gap, policymakers have also been considering how much funding to allocate to close the broadband adoption gap, which is a larger barrier to closing the digital divide than the availability gap.

As an example, if policymakers allocated $60B – $120B to spend on closing the digital divide, gigabit availability could be brought to all locations with <100/20 Mbps service and broadband adoption subsidies could be provided to eligible low-income families for five years.

Cost to solve availability and adoption issues: $61B to $118B

It will be up to policymakers to determine the best way to prioritize funding to close the digital divide, as well as to support other initiatives under discussion (e.g., next-gen 911, climate resilience, etc.).  Clear cost estimate frameworks will be critical as part of this process to ensure that the cost-benefit trade-offs associated with different policy approaches are properly understood.<>

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