Connect Kentucky's public/private pro-market approach

by: Andrew McNeill

Fri Jul 27, 2007 at 16:34

Mr. McNeill will be liveblogging on OpenLeft this evening at 7 PM EDT.

The challenge of ensuring high speed internet access to all Americans is a daunting one. Whereas a significant portion of the United States does have access to this technology and derives the benefits from having it, there is still a large segment of American households, primarily in our rural areas, that are lacking service.

This is the challenge that the state of Kentucky found itself facing in 2004. Confronted with the challenge, the state and private sector collaborated with ConnectKentucky - a public/private partnership - to launch the Prescription for Innovation. It is a comprehensive approach to addressing both the supply and demand side of the equation to enhanced broadband access and adoption.

(More in 'there's more'...)

Andrew McNeill :: Connect Kentucky's public/private pro-market approach
The initiative has tackled the challenge through working to ensure that the proper policy environment exists within the state to encourage investment, providing granular market intelligence to providers - telecom, cable, independent ISPs, fixed wireless - to help them build the business case for investment, through identifying the gaps in service through sophisticated GIS based mapping of broadband deployment and a local eCommunity process engaging local communities in demand side exercises to drive adoption. It's a progressive, pro-market approach that serves the public's interest in gaining greater access to advanced communications services while also recognizing that the private sector must be able to attain a sufficient return on investment to build out their infrastructure.

And, if I may say so myself, the results have been impressive. Currently 94% of Kentucky households have access to broadband internet service - up from only 60% two years ago. Adoption of the service - meaning those households that have it available and choose to subscribe - has grown by 73% since 2004. According to the Bureau of Labor Statistics, Kentucky has seen nearly 15,000 new technology jobs over the last two years with a growth rate that has far exceeded the national average. Computer usage is up, investment in technology and communications infrastructure is reaching unprecedented levels and Kentuckians are reaping the benefits of this progressive vision.

Given the success of the initiative, we have now formed Connected Nation - a national non-profit dedicated to replicating the successes of the Kentucky model. Connected Nation is based upon the comprehensive vision of addressing both the supply and demand side of the broadband equation through building public/private partnerships in other states. To accomplish this we have appreciated the endorsement of Senator Durbin and his support demonstrated through S. 1190 - the Connect the Nation Act. Its central tenet is to provide the necessary resources and framework for other states to address their broadband challenge.

Imagine if each state were to move aggressively to meet its broadband challenge by adopting the best practices of high speed internet expansion - many of which are inherent to the ConnectKentucky and Connected Nation models. What could we expect? If the experience in Kentucky is any indicator - and I tend to think that it is - the answer to what we could expect is a nation - its urban and rural areas - reaping the tremendous benefits of the wired world.

As Vice President of Program Development, Andrew directs the development of ConnectKentucky policy initiatives, foundation outreach, as well as the execution and implementation of the organization's governmental strategy. Andrew serves as ConnectKentucky's primary intergovernmental relations point of contact in Frankfort and Washington, D.C. He works closely with senior management and key stakeholders to identify new business opportunities and to ensure that existing partnerships are maintained and new relationships cultivated.

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profits, growth (0.00 / 0)
Do you have more details/breakdown on the actual increase in revenues for:

1.  broadband providers
2.  communities (before and after)
3.  state increased tax revenues
4.  individuals/small business (before, after)

I'm wondering about things like direct auctions of livestock and other raw materials from rural direct access (farmers, small business), as well as increasing rural sourcing (alternative to offshore outsourcing)of service sector jobs and the actual improvements in economic metrics.  

The Economic Populist

Suggestions for Connected America project (0.00 / 0)
ConnectKentucky provides a great model that seems replicable for the country as a whole. Perhaps it could be coupled with John W's suggestion for expanded federal funding to support next-generation broadband networks delivering at least 100 Mbps capacity.

"Engaging local communities in demand side exercises to drive adoption" is an important step, since broadband connectivity has the potential to transform the way our economy and society function--and in ways that may not be obvious or easily monetized by network operators.  Given the latter, these planning exercises should consider public benefits that are hard to finance through price-based market mechanisms (a.k.a., "externalities").  This could include questions about whether and how privately-funded profit-based networks can support these externalities, and whether their value justifies some public financing of network deployment, which John W discusses in his post today.

I also think the "open access" question should be factored into a Connected America project.  As I suggested in a comment on John W's thread, we might consider whether government subsidies to encourage deployment should be limited to networks that provide wholesale service, and potentially to network operators that ONLY provide wholesale services (to avoid potential discrimination against competing retail providers).

To summarize my points:
Extending current-generation broadband connectivity more broadly is very valuable, but  we should also be thinking about: 
1) ways to cost-effectively move to next-generation networks that provide additional public and private value; 
2)whether the networks that get deployed will be open enough to support vibrant growth of competitive retail services and; 
3) whether network deployments provide key public benefits that are not readily monetized by private-market pricing mechanisms, and how to insure they do.

Public/Private Partnership, Said Spider To Fly (4.00 / 1)
It's worth pointing out that much of the war effort in Iraq and the relief effort after Hurricane Katrina were public/private partnerships. They are not magic, at least, not white magic.  The balance of power between the public and private side makes all the difference.

What precisely do you folks mean by pro-market?

Many of the proposals I've seen look like attempts by the big incumbent players like AT&T and Comcast to freeze out other players and competing solutions like wireless access as a public utility.  This is not pro-market.  It's pro-corporate, and it's not in the public interest.

What are you folks doing, exactly?


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