CCIA Applauds New Joint Venture Aimed at Bridging the Digital Divide; Calls on Major Broadband Providers to Expand Model throughout Country

January 22, 2009

The Computer & Communications Industry Association applauds Meraki and OneEconomy’s partnership aimed at bringing broadband to low-income residents of San Francisco. CCIA also commends AT&T for making this possible by altering terms of service, which traditionally prohibit others from using DSL with wireless routers to serve individuals beyond one subscriber household. The benefits of such a model can be realized throughout the United States if carriers make similar commitments to non-profits around the country.

“As Congress gets set to vote on a stimulus package that would provide billions of dollars to encourage broadband deployment to underserved communities, policymakers and business leaders must develop new approaches to solving our connectivity problems. This is exactly the type of innovative thinking that needs to be encouraged and echoed to close the Digital Divide,” said Ed Black, CCIA President and CEO.

“Business as usual approaches will not help connect millions of disenfranchised Americans who have the most to gain from broadband and the benefits it can provide. The educational and commercial advantages that high-speed Internet access confers will help low-income residents more fully realize the benefits of the digital economy. We strongly urge AT&T and other last-mile broadband providers to make similar commitments to other qualified non-profits throughout the country. Until AT&T and other major providers voluntarily agree to allow non-profits to efficiently tap into the existing broadband infrastructure, these non-profits and their new technology cannot fill the service void. It will take more than just a one-time government infusion of cash to target underserved communities. New approaches that drastically lower the cost of Internet service, particularly to vulnerable communities who cannot not afford the traditional high cost of broadband access, must be encouraged.”

Since its founding in 2000, OneEconomy Corporation has worked tirelessly to bring the benefits of the digital age to low-income individuals around the world. It truly has proven to be a visionary organization that is redefining philanthropy in innovative ways. However, similar organizations with a primarily local or regional focus have begun to spring up around the country.

“Our organization, and others like it, have developed nearly identical models to the one recently announced by OneEconomy and Meraki,” said Lowell Feldman, a professor of Communications Law at University of Texas Law School whose students operate their own non-profit called USFON. “We will all be better off if we acknowledge when market failure occurs and then address the failure with an efficient technological response.

“For-profit business models have historically neglected poor communities for obvious reasons. If AT&T and other providers pledge to make similar terms available to a wide array of community organizations, my organization and others like it across the country are positioned for immediate action. Not only will existing non-profits be able to drastically expand their operations aimed at serving vulnerable low-income communities, but more non-profit initiatives will spring up at universities and charitable organizations around the country.

“If market entry impediments created by the incumbents like the ‘terms of service’ agreements are modified either voluntarily or by regulatory reform, we are likely to see a paradigm shift in how broadband and phone service are provided to poor communities. Just as important, the strain on Universal Service and other government subsidy programs will be relieved because of cost efficiencies achieved through the newer technology and alternative service models. Our students provide service through USFON for approximately one-eighth of what the incumbents claim is their cost. They are also motivated by a calling to community service, not by a motivation to maximize the subsidy amount from the government or the revenue from the subscriber.”

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