Is It Time For An REA for the Internet

The death of Senator Bryd at the age of 92, had me thinking about the technical advances he saw in his life time. That the fight to get those advances to the most people was being fought then and continues to be fought today. The battleground may have changed, but the arguments often repeat themselves. Today, the battle is over what is the best way to get broadband to the most people. In the 1930’s it was electricity. While 90% of all urban residents had electricity by the 1930’s only 10% of rural residence did. Electric companies of that time said it was too expensive to supply electricity to sparsely populated rural areas, that they could not justify the cost. Rural residents who were lucky enough to have electricity paid rates two times as high as those in urban areas. This was at a time when items such as refrigeration, the radio and the telephone, all which depended on electricity were coming into their own. Without electricity, rural areas were falling further and further behind their urban counter part.

Despite their unwillingness to build in rural areas, utility companies and their supporters fought against any kind of government involvement, They insisted that the free market would take care of the issue. By 1935 it was clear that the free market system was not working and that something had to be done to get electricity to the rural areas. To deal with the problem the Roosevelt administration, created the Rural Electric Administration. The REA supplied incentives in form of loans to private utilities to build the infrastructure to provide electricity in rural areas. In those areas where private companies could not or would not participate, the government encourage the formation of cooperatives which were established to provide electricity for coop members. By law these electric cooperatives could not compete directly against private companies. By the 1950’s nearly all rural areas had electricity either thru cooperatives or private industries.

My question is is it time for something similar to the REA to get high speed Internet or broadband to areas that are not being covered by private industries. Just as electricity was the backbone to much of the innovation of the 20th century, broadband will be the backbone of much of the innovation of the 21st century. As more and more business and communication is done on line, those who have no or slow Internet connection will get left further and further behind. Do we continue to depend on private industry to provide the broadband or do we consider other alternatives similar to the REA. What do you think


Comments

  1. teemark says

    The sad part is, the Telcos were already given millions in incentives and tax breaks that they promised they would use to roll out nation-wide fiber-optic. They pretty much took the money, did minimal upgrades, and now cry that they need to use packet shaping and throttling to maintain their networks, that they need to regress to tiered pricing structures to stay in business. All this at a time when bandwidth prices (between Telcos and backbone carriers) are at an all-time low – and falling!
    I think you’re on to something, but I also think it will take a heavier hand from the Feds to make this happen. We’ve already given them the tax breaks and incentives. The Telcos have a hugely profitable hegemony, and they’re not about to cut into their profit to extend broadband to less profitable areas unless they’re forced to.