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November 13, 2009 11:51 AM

FCC Misses Two Key Barriers For Broadband Adoption

The FCC just released their top five barriers to broadband adoption. They are:

- The affordability of service
- The affordability of hardware
- Lack of digital and technical literacy
- Lack of awareness of the relevance and utility of broadband
- Inability to use technology and apps due to physical or mental disabilities

While I don't disagree that these are all barriers, I think the FCC has missed two of the biggest barriers to universal broadband adoption.

The first is the question of the value proposition of broadband services. When consumers make decisions about whether or not to buy broadband it's not just the price that matters. They need to feel like they're getting fair value for their money and that they're going to be treated with respect as paying customers.

The former of these points relates to issues of how much bandwidth for how much money and how many restrictions are there on what can be done with that bandwidth. If I'm in an area where it costs a whole lot for not much then unless I really need broadband this is likely to turn me off to the idea of purchasing it. This isn't enough to stop someone from subscribing who has to have it, but it is likely enough to dissuade some of those who are on the fence.

The latter point relates to the undercurrent of resentment that many potential subscribers have to whoever might be providing broadband service in their area. Many of the big cablecos and telcos have poor reputations when it comes to customer service. So if I'm subscribed to cable or telephone service from one or the other, and they haven't treated me well, then I'm going to be disinclined from giving them any more of my money. While again this may not be enough to dissuade someone who really needs broadband, for those on the bubble it could be enough to keep them from signing up, especially since often their choices for who to subscribe to are limited.

Then bridging both of these points are issues like overage charges and bandwidth caps. If I've signed up to pay for broadband at one price, but I unexpectedly get a much larger bill in the mail simply because I used that service too much, then that's likely to dissuade me from wanting to keep that service any longer.

We have to get past the simplistic reading of the cost of broadband as a barrier and realize that also important is the nuance of how customers perceive the value proposition that a broadband service provider is offering them. Because if customers don't think they're getting fair value, that's a large disincentive for them to sign up for service.

The other major barrier that goes unaddressed in the FCC's top five is the need for broadband and the Internet to improve the user experience. Their point about the lack of awareness around the utilty of broadband among those who don't subscribe suggests that the Internet is already a highly useful tool for everyone to be using, that it's already jam-packed with relevant content. Also, the suggestion that digital literacy is a big barrier presumes that all that's needed is additional training to get everyone comfortable with using the Internet as it currently exists.

I would like to argue that we should also be paying attention to fostering innovation around ways to make the Internet easier to use and more relevant to everyone.

Too often I think we get caught up in the assumption that the Internet's already great and that all we need to do is expose people to it and they'll see the light. In reality we still have a long ways to go before we can make this assumption. For example, how many local governments have transitioned all of their systems online? How many healthcare systems are using electronic medical records? How many schools have educational materials online? Sure the number is increasing, but we're a long ways away from anything resembling universality.

Then on a related note, we need to be expecting more out of the usability of broadband and the Internet. I think we're making a mistake if we simply accept the user paradigm of today's computers and Internet apps as the best we can hope for, and focus all our attention on getting users to adapt to the technology. Instead we should be pushing the technology to evolve to meet the needs of consumers, especially in terms of making things easier for the mass market to adopt and use.

The simple truth is that for those not familiar and comfortable with computers, the current paradigm of how to access and gain from the Internet isn't easy or straightforward. First you have to know how to start a computer, then how to open a browser, then how to find anything, then what it means to download content, then to install applications, then we get into plug-ins and extensions, and very quickly you can see how the complexity of all of this is an incredibly high barrier for adoption.

It can be hard to recognize this as a barrier as for those of us already comfortable with computers they seem very easy to use. But if we're talking about how to achieve universal adoption, then we can't limit ourselves to these assumptions and to the idea that what's needed most of all is training when greater gains could potentially be achieved by innovation in user interfaces and how consumers access the Internet.

The clearest example of this to me is the iPhone. The iPhone has made it dead simple to use mobile broadband, whether it be through their robust browser or applications. If we want to achieve universal adoption and use, we're going to need more of these kinds of innovations.

The top five barriers to adoption that the FCC listed are a decent start, but they also only picked the most obvious choices. If we want to truly achieve our goals of 100% adoption and use, then we need to go beyond the easy answers and acknowledge that more nuanced barriers exist, like the value proposition of broadband service and the user interfaces associated with accessing the Internet.

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Comments (1)

Geoff,

You raise good points about the FCC's list of barriers being too simplistic. Your refinements get more to the crux of how elements of the FCC's list are related and apply to real world decision-making by end-users.

While I strongly agree with your points about the need for user-friendly government, healthcare and education e-services, your post also got me thinking about the evolution of video entertainment and its relevance to the broadband value proposition.

My household, like many others, has made the transition from cable TV to online video. As a result, we're spending $9/mo. on a Netflix subscription vs. $40-$50/mo. or more on digital cable with a DVR, on-demand, etc.

That frees up a significant amount of money (and time) every month that could be redirected towards non-entertainment broadband services.

And while I have no research to back this up, I wonder if relatively user-friendly online entertainment services like Netflix could help bridge both the "value proposition" and "usability" barriers you raise in your post, especially as they help bridge the traditional divide between PC-based and TV-based services.

To the extent we all begin to perceive combinations of connectivity, services, content and end-user devices more flexibly (a process already in motion, though to varying degrees for different population groups), and as these become more user-friendly, I wouldn't be too surprised if, over time, today's "triple-play" approach to service provision becomes replaced by a different and more customer-centric service model.

And I think this trend will be facilitated by increased fiber deployment, especially in combination with the kind of "muni" and "co-op" ownership/financing models discussed in your most recent post on UTOPIA, and comments on it by me and Chris Mitchell.

While investment payback is an important factor for these models, their ultimate purpose (not the means, but the end) is to maximize the value to individual end-users and communities as a whole, regardless of whether some of this value is not readily monetized through fees that directly support debt financing and profits.

Posted by Mitch Shapiro on November 16, 2009 4:23 PM

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