Bridging the Digital Divide: Net Neutrality and Rural Connectivity

In 2017, the Federal Communications Commission (FCC) released its Restoring Internet Freedom Order (RIFO) with the objective of “promoting broadband deployment in rural America” and “eliminating the digital divide” that exists between rural and urban America. The implementation of RIFO has produced concrete steps toward bridging the digital divide and ensuring rural Americans enjoy equal connectivity.

Eradicating the digital divide will be no easy feat for policymakers as approximately 21 million Americans do not have access to an internet connection. The digital divide is most pronounced between rural and suburban communities where, according to the Pew Research Center, only 63% or rural Americans had access to home broadband in 2019 compared to 79% of suburban Americans.

Prior to the RIFO, when former FCC Chairman Thomas Wheeler issued its onerous Open Internet Order (OIO) in March 2015, it dictated that Internet Service Providers (ISPs) would be treated as common carriers according to the Communications Act of 1934. The reclassification granted the federal government and FCC considerable power to regulate their prices, force them to provide a service in underserved communities, and ban what it considered to be unreasonable business practices – all under the guise of net neutrality..

Since the implementation of RIFO and the reversal of the OIO, the number of rural Americans with access to home broadband has increased significantly. In July 2015, four months after the Wheeler FCC implemented it onerous net neutrality rules, the percentage of rural Americans who had access to home broadband fell to 50%, down from a high of 63% in December 2013. Since the implementation of RIFO and the shift towards deregulation, the negative trend was reversed and the number of rural Americans who had access to home broadband returned to its December 2013 level.

In understanding the 13% decline in broadband access the OIO caused to rural Americans, it becomes clear how profoundly damaging enhanced regulation was to rural communities in terms of broadband connectivity. The statistics also show that during the same period, urban and suburban access was largely unaffected, highlighting how the guidelines exacerbated the digital divide.

Rural Americans are not only better connected because of RIFO, it has also provided them with faster internet. Between 2017 and 2019, the FCC estimated the number of rural Americans who had access to 250/25Mps internet speed, the metric for high-speed connections,  had increased by 85% between 2019 and 2020, largely fueled by “an approximately $80 billion dollar investment in network infrastructure” from both the FCC and private companies. The high capital investment that followed the implementation of RIFO was forecasted by the FCC when in 2017 they correctly predicted change in regulatory approaches would “increase ISP investment” in broadband infrastructure and allow for faster speeds.

The increased speeds due to investments in rural broadband from both the public and private sectors followed a period in which ISPs were simply unwilling to invest in unprofitable markets. Between the implementation of OIO in 2015 and RIFO in 2017, ISP investment in broadband infrastructure fell from $73 billion to $69 billion, with most investments occurring in urban communities. Since the implementation of RIFO in 2017, capital investment has since returned with a renewed focus on rural connectivity.

Much of the investment in rural American broadband focuses not on traditional wired service but providing communities access to advanced 4G LTE technology. In the two years following the demise of OIO, Verizon estimates its LTE in Rural America Program covers “just over 2.5 million people and more than 129,000 square miles through more than 1,350 LTE-enabled sites.” T-Mobile has made similar investments in providing rural Americans access to 4G LTE internet with an expansion to approximately 20 million consumers in over 450 rural cities and towns.

Were net neutrality rules to be reinstated, it is highly probable the significant capital investments in rural American internet connectivity would be lost. Facing more stringent regulation, ISPs would undoubtedly turn their investment interests to urban communities that require less infrastructure investment and would cover far more consumers. Put simply, rural America would have lost out and the digital divide would have widened.

The benefits of RIFO are not only measurable in terms of enhanced connectivity, investment, and speeds. For rural communities miles from urban centers, a fast and reliable internet connection provides workers the ability to work remotely, allowing them to pursue job “opportunities that otherwise might be too far for a commute.” For students, access to a fast internet connection enhances educational opportunities as they pursue online degree programs and improve their opportunities. In sum, access to a fast internet connection will ensure rural Americans have more opportunities for social mobility. Recognizing the enhanced connectivity RIFO has provided to rural communities should provide clear evidence of the harm that reinstating net neutrality would inflict on rural consumers, but also why further deregulation of ISPs is needed to close the digital divide.