But what about the one-third of American households that hasn’t yet adopted broadband at home?  Research from the Federal Communications Commission (FCC), the Pew Internet Research Center, and other groups shows there’s no single reason why people don’t sign up.  It might be a lack of digital literacy, little or no understanding of the relevance of broadband service, no computer at home, or affordability.

That’s why a new public-private partnership announced recently by cable’s leading broadband providers and the FCC seems so important.  The “Connect to Compete” (C2C) program unites a number of non-profit and private partners in a coordinated, community-based program that is dedicated to a common purpose – promoting adoption among certain families with school-age children that have not yet hooked up to broadband.

Cable broadband providers reaching 86 percent of U.S. households with broadband service have committed to participate in C2C or some other complementary program. They’ll offer a discounted promotional rate of no more than $9.95 a month (plus tax) for high-speed Internet access to qualifying families with kids in grades Kindergarten through 12 who receive free lunch under the National School Lunch Program.  Participating companies will waive installation fees in the case of standard or self-installation.  They’ll throw in a cable modem free of charge during the length of the program, or offer to sell one for a deeply discounted fee.  And those who sign up for the program will enjoy, at a minimum, download speeds of up to 1 Mbps, while some may receive faster speeds.

The program will launch in 2012, in the back-to-school period for the 2012-13 school year.  There will be a sign-up window of three years.  And any family that qualifies and signs up can stay in the program for up to two years.

C2C is the latest step in cable’s long journey of commitment to education.  That commitment to the value of broadband in education actually began more than 20 years ago when we started to wire and connect tens of thousands of schools and libraries, first for cable TV, and then to the information superhighway we now call the Internet.  Our efforts continue today, led by the industry’s non-profit education foundation, Cable in the Classroom, to promote and distribute educational content and help teachers and students use broadband technology and services safely and responsibly.

The program is also part of our legacy to promote broadband adoption.  We’re fiercely proud of being the first industry to bring broadband to American homes. Today, our companies provide broadband service to more than 45 million American homes.  We’re convinced that C2C will enable even more homes to adopt broadband – providing tremendous educational benefit to more American families.

For that reason, we applaud FCC Chairman Julius Genachowski’s announcement today of a new group called Connect to Compete, a “digital literacy corps” which will actively engage with consumers so they understand how high-speed Internet will enable them to find jobs, increase their skills and open up new opportunities.

We’ve addressed the issue of broadband adoption before (“Bringing Broadband to Low-Income Families” and “Increasing Broadband Adoption”), making this point that pertinence, and not just cost, has repeatedly been identified as a significant barrier to broadband adoption. In other words, as we said in this post:

…we’ve seen firsthand that some consumers simply see no benefit in broadband…that is until they start using the service and then they can’t stop.

The cable industry has been a leader in developing public-private partnerships as an avenue to increase broadband adoption. Many cable companies are deeply involved in community-based programs designed to overcome barriers to adoption, improve accessibility to broadband services and provide training and education on digital and internet literacy.

Comcast, Time Warner Cable, Cox Communications, Charter, Cablevision Systems, and Bright House Networks are just some of the cable operators that have launched community-based broadband adoption initiatives. (You can see more details on these efforts here, here and here.)

In addition, Discovery, one of cable’s premier programming companies, will contribute premiere educational content from Discovery Education, including video clips and digital lessons, to help bolster student achievement.

Cable has been a pioneer in proposing national partnerships, including the Adoption Plus program a few years ago, which included many elements that have been embraced in the FCC’s new initiative.

In addition, through Cable in the Classroom, the cable industry provides a variety of tools and resources to educators to encourage broadband adoption and enhance digital citizenship among the nation’s youth.

We’ll be continuing our efforts to encourage adoption and will also continue to engage in discussions with government policymakers and private sector partners to identify new ideas that will substantially advance our common goals.

The study noted that the rate of broadband growth is slowing (which happens as any new market begins to mature); and that a large percentage of non-subscribing consumers don’t believe that the government should be involved in addressing this issue.

The most pertinent findings from the report are that:

• 66% of Americans currently subscribe to high-speed Internet access at home, which equates to 3% year-over-year growth
• There was a 22% year-over-year growth rate in adoption by African Americans, by far the biggest growth rate of any major demographic group
• 53% say the spread of affordable broadband should not be a major government priority
• Respondents older than 50 were most skeptical that they would benefit from the Internet.

In delving deeper into the latter two statistics, Pew reports that, “Those who are not currently online are especially resistant to government efforts to expand broadband access.”  This is not necessarily surprising and points to an issue – relevance (i.e., “How will I benefit?”) – that has repeatedly been identified as a barrier to broadband adoption.

NCTA and the cable industry have been talking a lot about relevance and other broadband adoption issues for the past few years.  On this blog, we’ve talked about broadband adoption and considered the reasons why some people don’t choose to have home access.

In the community, we’ve seen firsthand that some consumers simply see no benefit in broadband…that is until they start using the service and then they can’t stop.

High-speed Internet service is available to 95% of American homes, but the Pew report found that 21% of American adults still do not use the Internet (and about 90% of those people say they aren’t interested in going online in the future).  So, while we seek to deploy broadband to areas that do not have access, we must also find ways to increase adoption of broadband technology.  The statistics clearly show there are a significant number of people who can get Internet service at home, yet have not jumped on the broadband bandwagon.

To help give adoption a push forward, NCTA and cable operators are finding ways to encourage adoption, improve digital literacy, educate on broadband issues and provide affordable broadband access, including:

• Digital Adoption Coalition. Led by the nonprofit organization One Economy, this coalition hopes to bring broadband to as many as 250,000 low-income households.  The coalition, which includes computer technology companies, ISPs, and the U.S. Department of Housing and Urban Development (HUD), has applied for funding to get broadband to citizens in public housing facilities via computers, low-cost access, and training programs.
• Adoption Plus. Last year, NCTA proposed the Adoption Plus (A+) Initiative, a public-private partnership designed to provide discounted computer equipment, media literacy training and deeply discounted broadband service for middle school children in low-income households.  A+ program would help give millions of students the opportunity to become digital citizens of the 21st Century by driving sustainable broadband adoption and positively affecting educational outcomes.
• Digital Connectors. Comcast is actively involved with non-profit One Economy in the Digital Connectors program.  This program provides talented youth with technology, leadership and 21st Century workplace training in return for their volunteer time providing service to their friends, families and community.
• LULAC Partnership. This summer, Time Warner Cable (TWC) and the League of United Latin American Citizens (LULAC) announced a partnership to increase broadband technology training.  TWC is providing a three-year grant for technology centers in Latino communities for training, technology and support services.  The technology centers across the country will become a part of LULAC’s Empower Hispanic America with Technology Network which already provides free broadband access to 100,000 people.  The centers will receive computer equipment, high-speed Internet access and educational curriculum.
• Cox’s Computers for Families (CFF) Program. Cox Communications a few years ago began their CFF program in Santa Barbara, California to promote broadband adoption.  This two-year public-private partnership provides sustainable broadband adoption for middle school-aged children in low income households that do not currently receive broadband service.  Sound familiar?  NCTA’s Adoption Plus program builds on this initiative at Cox.  In addition this past May, Cox began a new program in Fairfax County, Virginia called “Broadband CNCT” (Computers & Neighbors Coming Together) where homes of school-aged children in one neighborhood will receive high-speed Internet service at a discounted rate.  This is a pilot program the company hopes to replicate in other areas.

These programs are just a few examples of how industry, government and non-profit partners can address the core reasons why some Americans say they don’t and won’t subscribe to broadband.

The good news is that we have significant research which shows why these households haven’t yet subscribed.  In some cases, challenges in reaching these homes have been facilities-based – finding new and innovative ways of getting broadband service to rural and remote areas.

But in many other cases, as Pew Research and other firms have pointed out, the challenges involve “barriers to adoption,” namely, the availability of affordable computers, digital and technical literacy, an understanding of the relevance of broadband service, or the ability to afford the service itself (For further details, see the FCC paper entitled "Broadband Adoption and Use in America.").

We’ve been concerned about these issues for a long time.  Cable ISPs have invested heavily in building out their networks, making broadband service available to 92% of American households.  We’ve also focused on elements of digital literacy to help families better understand how to manage the content coming into their homes.  And, we are sensitive to the affordability of broadband service.  Many cable ISPs have established tiers of broadband service which allow subscribers to buy whatever level of service makes the most sense for them.

Broadband access for the two-thirds of American households that have it wouldn’t have been possible without the leadership of the private sector.  So we strongly agree with the Plan that one of the best ways to help connect more homes is through partnerships in which both the government and private industry bring something to the table.

Last December, after consultation with federal policy makers and other stakeholders, we proposed the Adoption Plus (“A+”) initiative.  A+ is a proposed two-year, public-private partnership.  It’s designed to promote sustainable broadband adoption for a vitally important population, middle school-aged children in low income households that don’t currently subscribe to broadband service.  Under the proposal, cable ISPs are prepared to offer deeply discounted broadband service and equipment, in partnership with schools, companies, and digital literacy groups that could help provide – to households where students qualify for free or reduced school meals – a package of affordable hardware and software, and training in digital literacy (See more in this previous post.).

Our strong interest in this kind of collaborative approach is why we’re happy to participate in a new pilot program that includes broadband ISPs, computer technology companies, nonprofits and the U.S. Department of Housing and Urban Development (HUD) to help bring broadband service to low-income homes around the country.

Under the leadership of One Economy, a global nonprofit committed to stimulating broadband adoption efforts in the neediest households, several parties have jointly filed an application to the National Telecommunications & Information Administration for funding through the Broadband Technology Opportunities Program.  The coalition will work with HUD to increase broadband adoption efforts in public housing and multi-family assisted communities. If the stimulus application is approved, federal funding – combined with actual and in-kind contributions from the various members of the coalition – would help bring broadband service to families in up to 250,000 government-supported housing units nationwide.  This target group encompasses many of the same families we propose to reach with the Adoption Plus proposal.

The coalition built around this HUD initiative comprises a unique collection of seemingly strange bedfellows.  There are the non-profits – One Economy and Connected Nation.  There are the hardware and software manufacturers – Intel, Dell, and Microsoft.  Telco ISP AT&T is involved in supporting the application, as are 14 of our member companies – BendBroadband; Bresnan Communications; Bright House Networks; Cablevision Systems Corp.; Charter Communications; Comcast; Cox Communications; Eagle Communications, Inc.; Mediacom Communications Corp.; Midcontinent Communications; Sjoberg’s Cable TV; Suddenlink Communications; Time Warner Cable; and US Cable Group, covering some 85%  of households across the country. Two trade associations – NCTA and USTelecom – also are in the mix.

The concept is simple.  Each entity involved in the initiative plays to its strengths in helping low-income families overcome barriers to adoption.  HUD will identify eligible households for the service.  The computer companies provide affordable hardware – which would be partly subsidized by the stimulus funding – and software, to help make families broadband-ready.  The nonprofits then provide training in digital skills and literacy, to families that are new to broadband.  And once these pieces are in place, the ISPs would offer deep discounts on broadband service, reduced-price or free modems, and free standard installation.

If you have read the Broadband Plan or its executive summary, the rationale behind this coalition may sound familiar.  The Plan highlighted the importance of creating, “public-private partnerships of hardware manufacturers, software companies, broadband service providers, and digital literacy training partners to improve broadband adoption and utilization by working with federal agencies already serving non-adopting communities.”

We think that with the formation of this coalition, and our ongoing efforts around Adoption Plus, we have hit the mark.

The WSJ’s Digits blog offered an accounting of the panel:

Panelist Josh Silver, the executive director and co-founder of Free Press, a media advocacy organization, ripped into his co-panelists, who represented the wireless and telecommunications industries.

He accused them of price-gauging Americans on Internet service and monopolizing the industry rather than engaging in competitiveness and helping provide affordable access to the poor. “We’re looking at industries which are protecting a very lucrative business model, and there are starting to be increasing numbers of people at the gates understanding that the ISP market should be competitive,” Mr. Silver said.

It was a very spirited discussion.

Let me quote a few notable remarks on Twitter:

@mikemathieu: AT&T and cable industry reps wriggling on stage as Josh Silver points out price protection schemes of broadband providers.
@zbrisson: One of the best things of the day, Silver from free press calling the cable companies out for their oligarchic greed.
@abenamer: josh silver points out that the lack of competition with the cable and telephone duopoly keeps prices artificially high
@jonathanpberger: The hatred for ATT & Cable co.’s is palpable. The people want blood.

Tough crowd.

Among James Assey’s comments, he pointed out that companies are investing significantly in infrastructure, which will encourage faster speeds. As he put it, “We’re leaning forward to the future.” As we’ve said many times, the cable industry along has invested well over $100 billion since 1996. Assey also noted that there is competition in the broadband marketplace; however, it costs a lot to build & maintain robust broadband networks and private capital is generally required. He also pointed to a recent Pew report (Home Broadband Adoption 2009) that found that value & utility beat availability & price when it comes to why respondents did or did not take broadband.

This national discussion of America’s broadband future is important and we’re committed to taking part in the conversation. We look forward to other events like PDF as the process moves forward.

The study notes that now, “63% of adult Americans now have broadband internet connections at home, a 15% increases from a year earlier.” That is up from 54 percent in 2007.

In addition, Pew’s study also looked at specific populations, like seniors, rural Americans and lower income households. Some key statistics from the report include:

• “Respondents reporting that they live in homes with annual household incomes below $30,000 experienced a 34% growth in home broadband adoption from 2008 to 2009.”
• “Broadband usage among adults ages 65 or older grew from 19% in May, 2008 to 30% in April, 2009.”
• “Adults living in rural America had home high-speed usage grow from 8% in 2008 to 46% in 2009.”

The broadband adoption numbers have definitely moved upwards in recent years and we should take a moment to applaud this progress. At the same time, there is still work to be done. We should ensure that all American households have access to some kind of broadband connection.

Broadband can be engine of job creation, a facilitator of educational and health care opportunities, and a means of shrinking the distances between isolated communities. Yet, without access, some folks are left behind.

This is why a broadband stimulus package (part of the American Recovery and Reinvestment Act) is so important. The stats demonstrate while broadband usage is going up, there is still a clear need to increase broadband adoption and use.

How these stimulus grant funds are used is critical. Earlier this year, we laid out a few ideas on how program should be structured around the following priorities:

1. Extending broadband facilities to unserved areas.
2. Supporting programs that enable underserved populations to acquire and to make effective use of broadband service where it is already available.
3. If funds remain, extending broadband facilities to underserved areas defined in terms of below-standard speed and other qualitative measures relative to today’s current-generation broadband services.

We’ve talked about the broadband stimulus package several times of the past few months. A white paper we released back in March provides our perspective on how funds should be implemented. And NCTA President & CEO Kyle McSlarrow shares his thought on this issue in this video. We also posted a White Paper from the U.S. Chamber of Commerce about the impact of broadband on senior citizens.

“Maybe we should treat the Internet more like the road system, look for ways of creating incentives to make the Internet more accessible to everyone, and less likely to be abused by the private sector,” Cerf said. … “It’s not likely you’re going to want to have multiple roads owned by the private sector to get to your house. Generally speaking, that’s true of the power system — you don’t have multiple wires going to your house to carry power.”

It’s good that Cerf cleared this up. He doesn’t want nationalized Internet. He just wants one wire going to your house, no “multiple roads” run by the private sector and something that resembles the road system (which is run by government, right?)

As just one example of why making the Internet like roads is a bad idea, look at the Big Dig in Boston. It was completed five years late for almost five times its original $2.6 billion budget. Just after it opened, a huge chunk fell on a passing cars causing injury and a fatality. It is a perfect example of government inefficiency on large scale building projects. Not exactly a great model when compared to cable’s $130 billion investment in its network and the more than $200 billion the telephone companies are expected to invest in their upgrade.

While I’m still confused about how making the Internet like roads isn’t actually a call for nationalization (to me, it looks like a duck, walks like a duck, and quacks like a duck…), fortunately, in the midst of the confusion comes a voice of reason.

The Pew Internet & American Life Project released its latest report on broadband adoption on Wednesday. Pew isn’t a group you can write off as Astroturf. They’ve done a lot of extraordinary research into how Americans are using the Internet. What did they find?

• The average price of broadband dropped 4% since the last survey (12/2005) to $34.50;
• Prices dropped despite the fact that 29% of respondents reported opting for a premium tier of broadband service – taking cable’s high-value offerings of faster speeds at a higher price;
• Across the board, broadband adoption grew 17% nationwide for the 12 months ending May 2008 – the strongest growth areas were among senior citizens, lower-middle income households and rural areas;
• The number of dial-up users who report disinterest in upgrading to broadband service remains roughly constant at 62% – even though the average price of dial-up actually increased 9% since the 12/05 survey;
• Of respondents who do not use the Internet, only 7% said that price was a deciding factor.

What this clearly demonstrates is what cable has been saying all along – while the goal of connecting every American is certainly a priority, and one we are working towards – the notion that there is a national crisis which requires immediate government intervention is simply overblown.

Contrary to assertions that the price of broadband in the US is prohibitively high, very few respondents in the Pew study agreed. This correlates nicely with the a Parks Associates Study last year that found very few people refused to get connected due to cost considerations. Adoption increased among Americans in households earning between $20-40k per year by 24% – the highest growth rate among any economic group.  Only among household earning less than $20k a year did adoption rates actually fall.  Given the state of the economy and the weakened dollar, this is not surprising. 

It does, however, highlight the need to specifically target the barriers to adoption that low-income families face – ranging from lack of computer ownership in the home to lower education attainment. In stark contrast to the OCED figures touted by groups like Internet for Everyone – figures about which there is considerable debate regarding methods and measurements – Pew finds that when you actually ask America what they’re paying for broadband you get a very reasonable-sounding number.

Further, the 17% growth rate in broadband adoption is astounding given the level of economic uncertainty gripping other sectors of the economy. This speaks to the steady march toward near-universal nationwide adoption. With more than 55% now connected, broadband Internet has passed the 50% barrier faster than any technology in history – faster than cell phones, radio, television, and computers, Will all Americans be online next year?  No, but we’re definitely getting there – and as we do, cable services are improving to keep pace with faster speeds and lower prices.

Last, but not least, note that 24% of dial-up users in rural America report that they would adopt broadband if it became available to them.  The big takeaway here is that the US, working with ISPs on policies such as the changes to the broadband loan program that were included in the Farm Bill, is doing exactly what it should be doing – focusing on the small percentage of Americans who are either unserved or underserved. There is clearly demand in rural America for broadband, and we ought to use the power of the government wisely to provide the right incentives for companies to connect the unconnected.

The cable industry continues to work with Connected Nation to identify areas that are not reached by cable so every effort can be made to focus government resources on those areas that need it most.

Let’s also not overlook voluntary efforts by the private sector. For more than a decade, cable systems through Cable in the Classroom have been offering complimentary broadband service to any school within the cable system’s broadband footprint. That’s an offer that’s been accepted by thousands of schools already, and it continues to stand today.

What we should not be doing, and the Pew study makes this clear, is pursuing heavy-handed regulation (or even worse, the radical nationalization ideas proposed by Vint Cerf and others).