| Failure of Demand = Insulting the poor |
| Friday, 29 January 2010 04:36 |
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The evidence is overwhelming that telling people why broadband is good has little or no effect. The thought that there isn't enough demand because "they just don't understand how useful broadband is" is pretty obviously a crock and an insult. The 30% of families who don't take broadband know what the internet is. You can't be a functioning person in our society and not have some notion the Internet is pretty important for many things. The people without broadband aren't ignorant savages in our midst. For many, there is no reason why they "need" to give phone companies $300-600/year for an internet connection. It's a lot of money and effort for something that isn't as important as other things the family needs. Too many children go to bed hungry in the richest country of the world; millions are thrown on the street every years because they can't pay the rent or the mortgage. Ask anyone who knows old folks living on social security, or a single mother just getting by. They'd welcome a net connection, perhaps, but very, very few would see their life change because they get broadband. It's insulting to think that poor and old people - the majority of those reasonably compos and unconnected - need middle class people to tell them what to do. That's essentially what all the "demand stimulus" programs are, except those that lower the effective cost of getting online. There's no evidence - none - that preaching has more than a very marginal effect. There is no "white man's burden" of "educating" the ignorant about the importance of broadband. (There should be an effect of actually teaching some computer basics, but the results of most training have been terribly disappointing.) There's plenty of evidence that bringing down the price makes a difference. Every carrier knows that if they want to increase sales they offer deals and that if they increase prices they lose a few customers. Verizon and AT&T net additions plummeted as the low end price went from $15 to $20, the single biggest blow to U.S. broadband penetration. Simply keeping that price down would mean the U.S. relative position would be better. Bringing down the cost with free or cheap computers should have a similar effect, although again there's little proff it makes a big difference. Making it easier to poor people to get connected probably helps - Verizon demand of a credit card is a very big barrier. The actual broadband connection is becoming so cheap prepaid is catching on when tried, but the carriers aren't very interested in low paying customers. This cries out to anyone who actually looks at the data. If outreach and advertising had much impact on people getting online, we'd be seeing the carriers doing a lot more. Instead, broadband advertising has been cut back drastically over the years, and mostly is designed to get folks to "choose me" rather than a competitor. So why are folks screaming so much for the government to waste money. Far too much of the noise comes from folks looking for funds, the "gimme, gimme, gimme" crowd. Many are honest folk who believe their approaches accomplish more than they do; many others are looking for support for community work that's well-intentioned. Some are the latest generation of poverty pimps and con artists drawn to where the money is. The really ugly group are the carriers and their shills who provide the funding and pr for some stupid ideas. The bells and their paid advocates spent tens of $millions promoting Connected Nation and similar. It very effectively diverted attention from the real problem, high prices because competition is weak. Broadband margins at Comcast are 80% according to wall street estimates, and most of the big carriers aren't far behind. Prices in several other countries are much cheaper. There's millions of dollars for any misguided scholar or overt charlatan who wants to hype this line; the researchers who don't take a lot of company money are far more skeptical. (Quote here from Cal, Greenstein.) The hardest to convince, perhaps, are the many who genuinely want to help the poor and are grasping at straws. Fakirs, usually bell paid, claim millions of jobs and billions of economic benefits from giving carriers money in the name of broadband. The NY Times and honest academics punched holes in this years ago, but it's such an attractive fantasy people want to believe. Let's look at the real reasons: cost, illiteracy, homelessness, infirmity. None of that is solved by preaching about "the value of the Internet." Nor will a handful of "educational" or "group-focused" websites providing content change much; there's no shortage of content for just about any group on the web.
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