Two members of the U.S. Federal Communications Commission called for the federal government to create a wide-ranging national broadband strategy to help small businesses compete on a global level.

Too many U.S. small businesses have no access to broadband, and many others can't afford it, said Michael Copps and Jonathan Adelstein, Democratic members of the FCC. The cost of consumer-level broadband per megabit in the U.S. is about seven times the cost in Japan, Adelstein told the U.S. Senate Small Business and Entrepreneurship Committee.

Small businesses "typically pay too much for a service that is too slow," Copps said. "It's not just a matter of national pride we're talking about -- it's a business issue."

A survey in 2005 found that small businesses paid an average of US$720 per month for a T-1 line, added Ben Scott, policy director of Free Press, a media reform advocacy group. In Chicago, customers pay $80 to $90 a month for 1M bps (bits per second) of broadband, but in smaller Urbana, Illinois, the cost is about $300, Scott said. In Greenup, Illinois, a city with about 1,500 residents south of Chicago, the monthly cost of a 1M bps connection is $1,300, Scott said.

Small businesses in small towns and rural areas lack the same technological edge that many overseas competitors have, Scott said. "The head start we're giving our global competition is taking it just a bit too far," he said.

Senators John Kerry, a Massachusetts Democrat, and Olympia Snowe, a Maine Republican, complained that President George Bush set a policy goal in 2004 for all U.S. residents to have broadband available by this year, but didn't back it up with policies.

"We had the goal but not the tactics," Snowe said.

A national broadband policy should include better data about where broadband service is lacking, said the FCC's Adelstein. The FCC still says a postal Zip code has broadband if one customer there does, he said. Congress should provide more money for broadband build-out in rural areas, and the Republican majority at the FCC should stop a deregulatory approach that has led to few broadband competitors, he said.

Adelstein also called for a national summit on broadband that would bring together customers, providers, members of Congress and the Bush administration and others to address broadband availability. "We should make broadband the dial tone of the 21st century," he said.

Not everyone at the hearing complained about the state of broadband in the U.S. There's little evidence of a broadband problem in the U.S., said Scott Wallsten, director of communications policy studies at the Progress and Freedom Foundation, a conservative think tank.

"Telephone, cable and wireless companies are investing billions in new high-speed infrastructure, and consumers and businesses are adopting broadband at remarkable rates," Wallsten said. Verizon Communications Inc. alone is planning to spend US$23 billion on its fiber-optic network by 2010, he said.

People calling for government solutions "fail to provide solid analysis showing that their proposals would actually benefit consumers or small businesses," Wallsten added.

Senator Bob Corker, a Tennessee Republican, laid the problems back at the feet of Copps and Adelstein. The FCC has the power to encourage more broadband competition through an upcoming auction of radio spectrum, he said. Several companies what to provide nationwide wireless broadband if the January auction is set up right, he said.

"It seems like to me you have the tools at the FCC," he said.

IDG News Service

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