Local and global consequences of the digital divide

Computerworld has an insightful article on the extent to which rural America is being left out of the digital age--and the reasons why telecommunication companies are ignoring those regions.

The article cites a report from the Government Accountability Office showing that just 17 percent of households in rural parts of the country subscribe to high speed internet service. According to the author, that's both unacceptable and unsurprising:

While many telecommunications carriers are posting record profits this year, millions of U.S. homes and businesses still have no access to broadband--and that's no coincidence.

The return on equity that Wall Street demands from players in today's largely unregulated telecommunications business all but requires carriers to abandon rural America.

But that harms the U.S. economy as a whole, the article goes on to argue, because "communications infrastructure is widely seen as the biggest driver of economic growth."

Companies that lack high speed internet connections are at a distinct disadvantage, and we're not just talking about mom-and-pop shops. For example, the pending Verizon-FairPoint deal in northern New England has put a local billion dollar e-commerce business in jeopardy:

"These guys were freaking out because the only network they've been able to have up there is an [asynchronous transfer mode] network, and it's going away when Verizon leaves," says an analyst who consulted with the company and asked not to be identified. "They may have to move [to another state]."

On an even larger scale, Trans World Entertainment--which operates more than a thousand music stores--is struggling with a lack of high speed internet access for 17 percent of its locations. Those stores must rely on slower, more expensive networks to connect to the chain's back-end system.

These difficulties have major consequences for rural areas--which lose businesses that require high speed internet--and for the country as a whole, as we lose ground to other nations with more extensive high speed networks.

Over at Tech Republic's IT News Digest blog, Andy Moon makes a good point about what needs to be done to fix this:

The government, in my opinion, has an obligation to provide either regulation or incentives to convince the telecoms to extend their services, just as they were forced to extend telephone service and just as the electric companies were forced to provide power to all areas.

Since high speed internet has become an essential service in today's digital economy, the government must ensure that high speed internet access is available in every corner of the country. That means enacting policies to expand access, but also stepping in when the actions of the private sector run in opposition to the goal of universal access--as is the case with Verizon's proposed landline sale to FairPoint. This deal would leave residents of Maine, New Hampshire, and Vermont behind, and the state governments must make sure that doesn't happen.

Tech Republic is also hosting a lively discussion about what policies should be put in place to break down the digital divide. Check it out and add your own thoughts.

ISPs to rural America: Live with dial-up (Computerworld)

The point? It's not fair (Speed Matters)

Rural broadband drought puts hurt on retailer (Computerworld Blog)

Digital divide separates urban and rural Americans (Tech Republic IT News Digest)

Discussion: Digital divide separates urban and rural Americans (Tech Republic)