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The Birth of the Digital Divide

Map displaying Census tracts where median Internet speeds show fixed broadband below 25/3 Mbps, according to Ookla data. (Source: NTIA)

A lot of the money being spent on broadband infrastructure today is trying to solve the digital divide, which I define as a technology gap where good broadband is available in some places but not everywhere. The technology divide can be as large as an entire county that doesn’t have broadband or as small as a pocket of homes or apartment buildings in cities that got bypassed.

I can clearly remember when the digital divide came about, and at that time, I remember discussing how the obvious differences between technologies were going to someday become a major problem. Today I’m going to revisit the birth of the digital divide.

Until late in the 1990s, the only way for almost most people to get onto the Internet was by the use of dial-up access through phone lines. ISPs like AOL, CompuServe, and MSN flourished and drew millions of people online. At first, dial-up technology was only available to people who lived in places where an ISP had established local dial-up telephone numbers. But the online phenomenon was so popular that ISPs eventually offered 800 numbers that could be reached from anywhere. There was no residential digital divide, except perhaps in places where telephone quality wasn’t good enough to accommodate dial-up. Some businesses used a faster technology to connect to the Internet using a T1, which had a blazingly fast speed of 1.6 Mbps, almost 30 times faster than dial-up. To people connecting at 56 kbps, a T1 sounded like nirvana.

The digital divide came into being when the faster technologies of DSL and cable modem were offered to homes. My first DSL line had a download speed of almost 1 Mbps, an amazing 18 times increase in speed over the dial-up modem. At almost the same time, some cable companies began offering cable broadband that also had a speed of around 1 Mbps. Homes in urban areas had a choice of two nearly-identical broadband products, and the early competition between telephone and cable companies was loud and fierce.

The advent of DSL created the first digital divide—the gulf between urban areas and rural areas. While telcos theoretically offered DSL in much of rural America, the 2-mile limitation of the DSL signal meant the speed didn’t carry far outside of the towns that housed the DSL transmitters, called DSLAMs. Many telcos were willing to sell rural DSL, even if speeds were often barely faster than dial-up. Soon after the first DSL was offered to customers, the vendors came up with ISDN-DSL that could deliver a speed up to 128 kbps deeper into rural copper networks—twice the speed of dial-up. But decent DSL never made it very far into most of rural America—and still doesn’t today for much of rural America.

The DSL and cable modem technologies improved within a few years after introduction, and the technology improvements created the second digital divide. I recall versions of DSL that had a maximum speed of 3, 6, 12, 15, 24, and eventually 48 Mbps. The big telcos upgraded to later DSL technology in some neighborhoods, but not others. Sadly, even today we continue to find places where the earliest versions of DSL are still offered, meaning there are places where DSL speeds never climbed above 3, 6, or 12 Mbps. This was particularly painful in towns that didn’t have a cable competitor because they were stuck with whatever flavor of DSL the telephone company offered to them. This was noticeable in big cities where some neighborhoods never saw any DSL upgrades. There was a well-known study done a number of years ago documenting the DSL technologies available in Dallas, Texas. The study showed that poor neighborhoods still had the slowest versions of DSL while more affluent neighborhoods had DSL speeds up to 50 Mbps.

Cable modem technology improved more quickly than DSL. By 2005, the cable modem won the speed game. And that’s when the cable companies started charging more for cable broadband—something they could do because the broadband was faster. This price difference largely meant that low-income households were stuck with DSL, while folks who care about speeds migrated over the years to the cable companies.

The digital divide in rural areas deepened as older DSL was not upgraded while the DSL that had originally been deployed started to reach end-of-life. Copper networks have lasted far past the expected economic useful life and get a little worse every year. In cities, any parts of the city stuck with only DSL fell far behind the neighborhoods where speeds increased significantly from both DSL and cable modems.

Unfortunately, we are not at the end of this story. There is a huge amount of fiber being constructed today in urban areas. But there is no reason to think that most of the ISPs building fiber are going to serve every neighborhood. The big telcos that build fiber like Verizon, AT&T, Frontier, CenturyLink, and others have always cherry-picked what they think are the best neighborhoods—best in terms of either demographics or the lowest in cost of deployment.

Unless we reach a time when fiber is everywhere, the digital divide will stick around. Right now, we’re tackling the rural digital divide—I expect in 5 or 10 years we’ll have to do this all over again to tackle the urban digital divide.

By Doug Dawson, President at CCG Consulting

Dawson has worked in the telecom industry since 1978 and has both a consulting and operational background. He and CCG specialize in helping clients launch new broadband markets, develop new products, and finance new ventures.

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