Affordable, universal broadband service has never been more important. It has become the essential gateway to access information on everything from education and government services to cultural exploration and community engagement. But it’s a gateway through which more than 30 million Americans are unable to walk. In 2019, there are millions of Americans – who often identify as women, girls, and people of color – who do not have affordable high-speed internet and are stranded on the wrong side of the “digital divide.”
Currently, the Federal Communications Commission is working to fix this, by clarifying the local “franchise fees” that drive up consumer cable bills and that create another barrier to keeping 30 million of us disconnected from the opportunity to be full participants in our continually evolving digital society. The FCC’s decision in this matter will impact internet accessibility for these unserved and underserved communities because it will dictate how much consumers pay for internet service.
Here’s the story. Since the early 1990s, federal law has allowed local and municipal governments to charge cable television companies for access to their “rights of way” – the sewer ducts, telephone poles, and city land – that the companies use to deliver their services. These fees are capped by federal law at 5 percent of a provider’s cable television revenues.
In recent years, however, some local and municipal governments have tried to expand these fees to also cover a cable company’s broadband internet revenues despite a strong federal policy against taxing the internet.
The U.S. Congress understands that any taxes on the internet will simply be passed on to consumers – the worst kind of regressive taxation on an essential service that falls most heavily on low-income and struggling families.
Many states and local governments have tried to hide these deterrents by cloaking them as “in-kind” contributions required of broadband providers – such as free service for government buildings or building out new city facilities. Others have tried to redefine the accounting terms that determine the 5 percent cap of cable television gross revenues to reach internet funds.
The FCC proceeding can secure equity and fairness in the future of the internet by ensuring that any unfair backdoor taxes or any re-accounting of the 5 percent franchise fee to reach broadband services are not allowed.
As it stands, the 5 percent franchise fee already produces over $3 billion a year to local governments while leading economists estimate the cost of these ‘in-kind’ requests will exceed $8 billion a year by 2023 – a total $11 billion a year hit to consumer bills.
No one denies that many of the goods and services that local governments are funding with these fees are worthy and useful, but the most marginalized within the communities that these governments are meant to serve will be the most disparately impacted. The cost goes beyond higher broadband bills. The real human toll will be paid by the millions of low-income and working-class Americans forced to choose between access to broadband and other vital needs and services. The real cost will be the loss of access to education, health care, government services, and job opportunities that affordable home broadband brings.
For most Americans, the issue isn’t whether cable companies can afford to pay. It’s whether we can. The school-aged child who cannot complete her homework assignment because she does not have broadband access at home. The college graduate who must fill out online job applications at her local Starbucks. The rural working woman who is making the leap of faith to entrepreneurship but who is unable to manage her growing online business using her dial-up internet.
The result of tactics like extending cable franchise fees to broadband services will be an expanded digital divide as home internet service becomes out of reach for more and more Americans – disproportionately Black and brown and rural and female. That in turn will lead some internet companies to slow down their own investment and construction of new networks, shutting out neighborhoods that are already underserved and ushering in a new era of cyber redlining where internet is built to “desirable” neighborhoods and the wealthy bask in an unneeded over-abundance of internet riches while poorer and browner citizens are marooned offline in creeping digital deserts.
As the internet’s promise is still unfolding all around us, we must ensure that no additional barriers obstruct the gateway that it has created for changing and improving Americans’ quality of life.
Celeste McCaw is Tech and Telecommunications Fellow at The National Council of Negro Women Inc.
Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.