[Senate Hearing 113-307]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 113-307

 
                   BROADBAND ADOPTION: THE NEXT MILE

=======================================================================

                                HEARING

                               before the

      SUBCOMMITTEE ON COMMUNICATIONS, TECHNOLOGY, AND THE INTERNET

                                 of the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 29, 2013

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation


                                 ______

                   U.S. GOVERNMENT PRINTING OFFICE 
88-384                     WASHINGTON : 2014
____________________________________________________________________________ 
For sale by the Superintendent of Documents, U.S. Government Printing Office, 
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202ï¿½09512ï¿½091800, or 866ï¿½09512ï¿½091800 (toll-free). E-mail, [email protected].  


       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

            JOHN D. ROCKEFELLER IV, West Virginia, Chairman
BARBARA BOXER, California            JOHN THUNE, South Dakota, Ranking
BILL NELSON, Florida                 ROGER F. WICKER, Mississippi
MARIA CANTWELL, Washington           ROY BLUNT, Missouri
MARK PRYOR, Arkansas                 MARCO RUBIO, Florida
CLAIRE McCASKILL, Missouri           KELLY AYOTTE, New Hampshire
AMY KLOBUCHAR, Minnesota             DEAN HELLER, Nevada
MARK WARNER, Virginia                DAN COATS, Indiana
MARK BEGICH, Alaska                  TIM SCOTT, South Carolina
RICHARD BLUMENTHAL, Connecticut      TED CRUZ, Texas
BRIAN SCHATZ, Hawaii                 DEB FISCHER, Nebraska
MARTIN HEINRICH, New Mexico          RON JOHNSON, Wisconsin
EDWARD MARKEY, Massachusetts         JEFF CHIESA, New Jersey
                    Ellen L. Doneski, Staff Director
                   James Reid, Deputy Staff Director
                     John Williams, General Counsel
              David Schwietert, Republican Staff Director
              Nick Rossi, Republican Deputy Staff Director
   Rebecca Seidel, Republican General Counsel and Chief Investigator
                                 ------                                

              SUBCOMMITTEE ON COMMUNICATIONS, TECHNOLOGY, 
                            AND THE INTERNET

MARK PRYOR, Arkansas, Chairman       ROGER F. WICKER, Mississippi, 
BARBARA BOXER, California                Ranking Member
BILL NELSON, Florida                 ROY BLUNT, Missouri
MARIA CANTWELL, Washington           MARCO RUBIO, Florida
CLAIRE McCASKILL, Missouri           KELLY AYOTTE, New Hampshire,
AMY KLOBUCHAR, Minnesota             DEAN HELLER, Nevada
MARK WARNER, Virginia                DAN COATS, Indiana
MARK BEGICH, Alaska                  TIM SCOTT, South Carolina
RICHARD BLUMENTHAL, Connecticut      TED CRUZ, Texas
BRIAN SCHATZ, Hawaii                 DEB FISCHER, Nebraska
                                     RON JOHNSON, Wisconsin


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on October 29, 2013.................................     1
Statement of Senator Pryor.......................................     1
Statement of Senator Wicker......................................     2
    Prepared statement of Tom Koutsky, Chief Policy Counsel, 
      Connected Nation submitted by Hon. Roger F. Wicker.........    60
Statement of Senator Klobuchar...................................    50
Statement of Senator Rubio.......................................    52
Statement of Senator Ayotte......................................    56

                               Witnesses

Hon. John E. Sununu, Co-Chair, Broadband for America and former 
  U.S. Senator from New Hampshire................................     4
    Prepared statement...........................................     6
Aaron Smith, Senior Researcher, Pew Research Center's Internet 
  Project........................................................     9
    Prepared statement...........................................    11
Bernadine Joselyn, Director, Public Policy and Engagement, 
  Blandin Foundation.............................................    13
    Prepared statement...........................................    14
Sunne Wright McPeak, President and Chief Executive Officer, 
  California Emerging Technology Fund............................    22
    Prepared statement...........................................    24
David L. Cohen, Executive Vice President, Comcast Corporation....    37
    Prepared statement...........................................    38

                                Appendix

Hon. John D. (Jay) Rockefeller IV, U.S. Senator from West 
  Virginia and Chairman, U.S. Senate Committee on Commerce, 
  Science, and Transportation, prepared statement................    71
Follow-up Submission to Testimony Submitted by Sunne Wright 
  McPeak, President and CEO, California Emerging Technology Fund.    71
Letter dated November 11, 2013 to Hon. Mark Pryor and Hon. Roger 
  Wicker from Lilian P. Coral, Director, 2-1-1 California........    75
Letter dated November 8, 2013 to Hon. Mark Pryor and Hon. Roger 
  Wicker from Alicia Orozco, Project Manager, Get Latinos 
  Connected, Chicana/Latina Foundation...........................    76
Letter to Hon. Mark Pryor and Hon. Roger Wicker from Luis 
  Granados, Executive Director, Mission Economic Development 
  Agency (MEDA)..................................................    77
Letter to Hon. Mark Pryor and Hon. Roger Wicker from Mike Dozier, 
  Executive Director, California State University, Fresno........    79
Letter to Hon. Mark Pryor and Hon. Roger Wicker from Martin O. 
  Gomez, Ph.D., Instructional Leader, Santee Education Complex...    80
National Hispanic Media Coalition, prepared statement............    80
Letter dated October 29, 2013 to Senator Mark Pryor and Senator 
  Roger Wicker from Javier Palomarez, President and CEO, United 
  States Hispanic Chamber of Commerce (USHCC)....................    82
Response to written questions submitted by Hon. Amy Klobuchar to:
    Aaron Smith..................................................    84
    Bernadine Joselyn............................................    84
Response to written questions submitted by Hon. Marco Rubio to 
  Hon. John Sununu...............................................    89


                   BROADBAND ADOPTION: THE NEXT MILE

                              ----------                              


                       TUESDAY, OCTOBER 29, 2013

                               U.S. Senate,
Subcommittee on Communications, Technology, and the 
                                          Internet,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 10:30 a.m., in 
room SR-253, Russell Senate Office Building, Hon. Mark Pryor, 
Chairman of the Subcommittee, presiding.

             OPENING STATEMENT OF HON. MARK PRYOR, 
                   U.S. SENATOR FROM ARKANSAS

    Senator Pryor. I'll call our Subcommittee to order. I want 
to thank everyone for coming to the Subcommittee on 
Communication, Technology, and the Internet.
    Our hearing today is entitled ``Broadband Adoption: The 
Next Mile.'' Again, I want to thank all of our witnesses for 
coming. And some traveled to be here, and we appreciate that.
    I want to especially thank our former colleague, Senator 
John Sununu. It's great to see you again this morning. You 
know, back when he was in the Senate, he used to always remind 
me that he was the youngest Senator in the Senate. You know? 
So, that's what we had to deal with all the time. So, maybe we 
can ask him some real hard questions today. What do you think 
about that?
    [Laughter.]
    Senator Pryor. No, really, thank you all for being here. 
And this is a story where you see the public and private sector 
who have done a tremendous job in trying to make sure that 
Americans have access to broadband. There has been a great deal 
of progress there. Lots of investments. Our providers, 
nonprofits, private entities have all been working very, very 
hard to achieve that goal of access. And the Federal Government 
has done some things with Universal Service Fund, BTOP, and 
other programs. And certainly, as we have the hearing today, we 
don't want to diminish the progress that we've made; we also 
don't want to forget about the millions of Americans who have 
access but still maybe need faster access. But, today our 
focus--today our focus is on broadband adoption, which is a 
little different than just access.
    Nearly 30 percent of all Americans who have access to 
broadband do not subscribe to those services. That is, millions 
of Americas who--Americans who risk being on the wrong side of 
the digital divide. So, today the Subcommittee will look at the 
various barriers to broadband adoption and the strategies for 
overcoming these barriers.
    And just as the public and private sectors have worked so 
hard and invested billions of dollars toward broadband 
deployment, they're also putting significant time and effort 
and resources to encouraging Americans to take advantage of 
this very important resource.
    So, I want to commend our witnesses today, but also the 
private sector and others for doing all that they've done to 
get us where we are today.
    But, I also hope that today we'll hear some of the lessons 
learned on the ground, to understand how to encourage more 
people to sign up to this, what is now becoming, and has 
become, just critically important and necessary infrastructure 
for the 21st century. We, in Congress, hear every day about 
success stories from individuals and communities where 
broadband has made significant impacts. And, of course, our 
providers have a lot of firsthand stories about improvements 
and benefits to homes, schools, businesses, et cetera. However, 
for many Americans, those successes remain hidden.
    So, I think there are probably three reasons why some 
Americans don't sign up, but we want to hear from the witnesses 
about their thoughts. One would be--a lot of Americans just 
don't understand the relevancy and why they should do this. A 
lot of Americans feel like they're not capable or they don't 
have the skills to do it. And then there are some Americans who 
say they just can't afford it.
    So, today we'll hear from a provider and various nonprofit 
organizations that have been working to identify who is and who 
is not online, why Americans are or are not connecting, and 
developing and implementing strategies to encourage Americans 
to adopt broadband Internet. I want to hear from our panelists 
about the most effective ways that we can do this, policies 
that maybe we need to support, the role of the Federal 
Government in improving broadband adoption rates.
    And so, again, I want to thank you. And we'd like to hear 
from Senator Wicker and then from our witnesses.

              STATEMENT OF HON. ROGER F. WICKER, 
                 U.S. SENATOR FROM MISSISSIPPI

    Senator Wicker. Thank you, Mr. Chairman, for holding this 
important hearing on the state of broadband adoption in 
America.
    Over the past year, this subcommittee, under the Chair's 
leadership, has done a great job of providing a forum for 
education and discussion on the state of communications policy 
in our nation, covering a broad array of topics. However, the 
common denominator in all of our hearings has been the emphasis 
on the importance of broadband for all Americans.
    As I've mentioned before, we, as policymakers, must ensure 
that any digital divide that exists between Americans--whether 
that divide is urban or rural, young or old, high income or low 
income--must be bridged. Our goal should be that all consumers 
be able to take full advantage of our 21st century broadband 
economy.
    The deployment of broadband via cable, DSL, fiber, 
wireless, and satellite has been a success. According to NTIA 
at the end of 2012, nearly all American consumers had access to 
some form of high-speed broadband. However, there are still 
challenges to be examined, particularly in regard to consumer 
adoption of broadband services, which brings us to our hearing 
today.
    According to the FCC, the broadband adoption rate in the 
United States stands between 62 and 68 percent, meaning 
approximately one-third of Americans who have access to 
broadband choose not to subscribe to the service. Of particular 
interest is the agency's finding that the broadband adoption in 
non-urban areas is significantly lower than in urban areas.
    So, while tens of millions of Americans now have access to 
broadband, they choose to remain offline. The primary reasons 
for non-adoption include the lack of digital literacy, 
questions regarding the relevancy of broadband in their lives, 
and the cost of equipment and service.
    Mr. Chairman, you and I both know the importance of 
broadband adoption. Our fellow citizens in Mississippi and 
Arkansas have perhaps not taken to the Internet quite like our 
colleagues in Minnesota, for example, or New Hampshire. I fear 
this lack of adoption may hold our states back as we move 
deeper into the 21st century, but I also see this as a great 
opportunity to bring more of our great people to the online 
world to share their interests and talents and improve their 
lives.
    Assembled here today are witnesses with a broad and varied 
knowledge of broadband adoption in America. We have 
representatives of Internet service providers, like Comcast, 
which is celebrating its 50th anniversary this year and, I'm 
proud to say, was founded in Tupelo, Mississippi, where I 
reside. We also have a private philanthropic organization in 
Minnesota's Blandin Foundation, a nonprofit from California, 
and the Pew Research Center, which has provided valuable 
reports and data for us to consider.
    I also would like to welcome John Sununu back to this 
committee, and note, Mr. Chairman, that, according to his 
nameplate, one can leave the Senate and this committee and 
still remain ``Honorable.'' And that is good to know.
    [Laughter.]
    Senator Wicker. Senator Sununu served here on this 
committee with distinction for a number of years.
    So, I look forward to hearing all of our witnesses.
    Thank you, again, Mr. Chairman, for holding this important 
hearing.
    Maximizing broadband adoption needs to be a top priority of 
this subcommittee. This hearing will provide a good opportunity 
for our members to learn about not only the successes of 
broadband adoption, but, more importantly, what can still be 
achieved.
    Thank you, sir.
    Senator Pryor. Thank you.
    And what we'll do is, we'll make all of the members, here, 
their opening statements, part of the record. And we also, for 
all of our witnesses today, your full statements will be made 
part of their record, so feel free to summarize those. And we'd 
ask you to keep all your statements to 5 minutes, and we look 
forward to the round of questions.
    Let me just introduce the entire panel, then I'll just call 
on you, one by one.
    First, of course, we have Senator John Sununu. He's the 
Honorary Co-Chair of Broadband for America. Second, we have Mr. 
Aaron Smith, Senior Researcher, Pew Research Center, Pew 
Internet & American Life Project. Next, we have Ms. Joselyn, 
Director of Public Policy and Engagement, Blandin Foundation. 
And next, we'll have Ms. McPeak, President and Chief Executive 
Officer, California Emerging Technology Fund. And last, and 
certainly not least, we have Mr. David Cohen. He's the 
Executive Vice President of Comcast Corporation.
    So, without any further ado, let me recognize Senator 
Sununu for your opening statement. Thank you for being here.

          STATEMENT OF HON. JOHN E. SUNUNU, CO-CHAIR,

         BROADBAND FOR AMERICA AND FORMER U.S. SENATOR

                       FROM NEW HAMPSHIRE

    Senator Sununu. Thank you very much, Mr. Chairman. It 
really is a pleasure to be here. Happy to be on this side of 
the witness stand, which is, obviously, new for me. I don't 
think I've been in this room in five years. And, well, it's not 
a complaint, my only observation is, these chairs are much 
lower than I expected them to be.
    [Laughter.]
    Senator Sununu. But, happy to be here, nonetheless. And 
nice to see former colleagues here; and, in particular, Senator 
Ayotte, who's doing such a great job for the people of New 
Hampshire.
    I'm, as you indicated, Mr. Chairman, the honorary co-chair, 
along with former Congressman Harold Ford, of Broadband for 
America. It's an organization--a coalition of 300 or so 
members--whose mission is focused on encouraging broadband 
investment, deployment, access, and adoption. So, happy to be 
here to talk about what we see happening in those areas and to 
talk a little bit about adoption initiatives, as well. But, 
we've got a great panel here of many who are working in 
different regions of the country, in different programs, and 
who can share their experience, as well.
    It's hard not to focus on broadband investment when you're 
talking about this topic. It's different than adoption, but it 
has got to start somewhere, and oftentimes it starts with 
money. And over the last several years, I think there's a very 
positive story to talk about in America on broadband 
investment--$250 billion invested by the broadband industry 
over the past 3 years. I think the Progressive Policy Institute 
highlights just the six largest broadband providers investing 
$50 billion in the last year.
    And, let's face it, the broadband infrastructure, it's not 
the be all and end all, but it is the foundation for a lot of 
innovation and economic growth that's going on out there. In 
particular, companies like Google or Apple, but even more 
prominently and more recently, the applications industry. The 
apps industry now employs 750,000 people. It didn't exist five 
years ago. Investment then leads to competition. Very 
important. The OECD ranks the U.S. third in broadband 
competition in the world. We--as was mentioned, I think, by 
Senator Wicker, 94 percent of people in the country have access 
to one or more wired broadband providers, 82 percent have 
access to four or more wireless broadband providers. So, the 
competition is there, and access, in many parts of the 
country--most parts of the country--is there.
    And it's interesting to look at the growth in access. Over 
the last 10 years, we've gone from 15 percent of the country 
having access to broadband to 98 percent of the country having 
access to broadband. That's great progress. Ninety-six percent 
having access to networks that are capable of 10 megabits per 
second or more, 85 percent of the country having access to 
technology that can give 100 megabits per second or more. And 
speeds, similarly, have increased by about 20 percent over the 
past year.
    So, investment, we've got better and growing competition. 
We have access. What about adoption? Because adoption isn't the 
same as access.
    Pew--and we're fortunate to have Aaron here from Pew --
they've done a lot of study and research in this area. Right 
now, we've got about 70 percent of the country with wired 
broadband access--or, wired broadband service--that is, they've 
adopted it; 80 percent with wireless broadband service. So, 
we've made progress, but we can do better.
    And, in particular, we've got a gap. You know, among whites 
that adoption rate is 75 percent; among African Americans, it's 
65 percent, roughly; and among Hispanics, it's 55 percent. Now, 
the gap is closed--over the last 4 years, the gap has closed by 
roughly half for African Americans, but that doesn't mean we 
can't or shouldn't do better in those underserved or areas of 
the country that haven't taken up adoption like we would want 
them to.
    There are lots of reasons. Both of you--the Ranking Member 
and the Chairman mentioned relevancy, that the computers, the 
equipment is expensive, and, of course, the cost of 
connections. It's all about digital literacy. It's about 
education. And it's about having people understand the value to 
them.
    I would close by emphasizing that, in this case, there's no 
single solution that's right for the entire country. There's a 
corporate involvement and responsibility, there's a government 
role, there are partnerships. It could be Big Brothers, Big 
Sisters, or the Boys and Girls Clubs, or the United Way 
undertaking local programs. It could be companies like Comcast 
in their Internet Essentials Program. AT&T, 250 million in 
their Aspire Program. Bright House is a $2 million program 
that's reached out to 1,500 schools.
    Finally, in terms of the role of government, because that's 
what you're interested and focused on, the light touch 
regulatory approach has been very important in providing an 
atmosphere that encourages and incentivizes investment in 
innovation. The NTIA has done a great job with their toolkit 
for digital literacy that focuses on all of these issues--
pricing and the cost of equipment and in educating consumers.
    And then, finally, from a regulatory perspective, I think 
you need to continue to allow providers to experiment and 
innovate in the way they package and price the product, 
especially in an age when there are more and more different 
ways to get access to content over the top and other ways.
    So, I appreciate the work that you've done here. I 
apologize that I've gone over time. I said to Senator Wicker, 
``That's my only fear, is that, in an effort to summarize my 
remarks, I exceed the 5-minute time limit.'' I have failed. 
But, hopefully, the minute is something we'll get back.
    Thank you for your interest in the topic, and I look 
forward to your questions.
    [The prepared statement of Senator Sununu follows:]

  Prepared Statement of Hon. John E. Sununu, Co-Chair, Broadband for 
           America and former U.S. Senator from New Hampshire

    Chairman Pryor, Ranking Member Wicker and distinguished Members of 
the Subcommittee, good morning. Thank you for inviting me to join you 
today and thank you for bringing attention to this important national 
priority.
    My name is John Sununu, a former member of this chamber, proudly 
representing New Hampshire from 2003 to 2009. Along with my friend and 
former Congressman Harold Ford, I am co-chair of Broadband for America. 
I have a long interest and extensive professional experience in the 
high-tech and broadband-related industries. I currently serve as 
director of Time Warner Cable and Boston Scientific Corporation. Before 
my career in government, I served as Chief Financial Officer of 
Teletrol Systems. I also received my master's degree in electrical 
engineering from the Massachusetts Institute of Technology.
    Broadband for America promotes well-informed public policy choices 
to create the right incentives for the private sector to build advanced 
networks and offer innovative services throughout the nation, and to 
encourage all Americans to become digitally literate and adopt 
broadband Internet. Our members include national and state-based 
community organizations, education and medical professionals, religious 
and minority groups, and stakeholders in the broadband Internet 
industry. Since our founding, Broadband for America has been dedicated 
to improving broadband adoption throughout the country; this is 
something our more than 300 members care passionately about.
    Today, I would like to focus on two topics:

   The U.S. broadband success story, marked by vibrant 
        competition and remarkable levels of sustained investment, and;

   How we can all work together to help further shrink the 
        broadband digital divide and increase broadband adoption.

The Ongoing Broadband Success Story
    Broadband for America believes broadband is for everyone. As the 
National Broadband Plan states, ``broadband is a foundation for 
economic growth, job creation, global competiveness, and a better way 
of life.'' Today's broadband networks enable an array of services--
voice, video, e-commerce, and more--over high-capacity wired and 
wireless connections. This platform is revolutionizing our lives: 
improving educational outcomes, delivering better health care, and 
creating a new world of jobs and commercial opportunities.
    A Broadband Nation. Today, 98 percent of American consumers have 
broadband access with 96 percent of households capable of accessing 
speeds 10 Mbps or higher. Only a decade ago, just 15 percent of 
households had broadband access of any kind. Over that time, billions 
have been poured into our economy and broadband networks to build this 
robust infrastructure across technologies. In just the last 3 years, 
broadband providers overall have invested more than $250 billion. In 
2011 alone, 18 million miles of optical fiber were installed in the 
U.S. This laudable level of investment in difficult economic times has 
pushed broadband deeper into communities at higher and higher speeds, 
driving competition and benefiting consumers.
    Broadband providers compete vigorously today on price, 
availability, and speed, providing consumers with constantly innovating 
services, devices, and digital options. Thanks to a light-touch 
regulatory framework based on a long-standing bipartisan approach to 
incent next-generation investment, the U.S. remains a global leader in 
broadband opportunity and competition. In fact, the Organization of 
Economic Co-operation and Development (OECD) ranks the U.S. third for 
competition among carriers of different technologies. The Federal 
Communications Commission (FCC) reported that in 2012, 82 percent of 
the U.S. population had access to four or more wireless broadband 
services, up from 68 percent in 2010. Internet service providers (ISPs) 
deliver broadband via phone lines, cable, fiber, satellite, and fixed 
and mobile wireless connections--all capable of delivering speeds 
unthinkable a decade ago. These speeds continue to escalate: the 
average U.S. broadband speed has increased by 22 percent over the past 
year, and the fastest wired Internet speeds available are 19 times 
faster than speeds available six years ago.
    Broadband providers have delivered these faster and faster speeds 
while keeping prices static: the U.S. has the second lowest entry-level 
pricing for broadband among OECD countries. And entire new industries, 
like the mobile apps sector, have emerged from the innovation engine 
that is the Internet economy. Not even in existence five years ago, the 
mobile app industry now employs 750,000 Americans while generating $18 
billion in revenue last year. Investment in the broadband space has led 
to new technologies at a rate faster than ever before. Better broadband 
technologies encourage innovation and adoption of broadband by 
consumers. Higher adoption rates lead broadband providers to further 
invest in their networks. This cycle of innovation and investment has 
propelled broadband services forward faster than any other technology.
    These broadband deployment efforts in the U.S. are remarkable--with 
broadband providers leading in U.S. investment. Last year alone, the 
Progressive Policy Institute found the top six broadband providers 
invested over $50 billion. But we need to develop solutions to deploy 
broadband in those rural areas where there is not a market based 
solution. The Administration's policies and the FCC's Connect America 
Fund are designed to help ensure that all Americans have broadband 
access.
    Adopting Broadband. From that remarkable technological foundation 
it should come as no surprise that Americans have quickly embraced the 
benefits of broadband connectivity. American consumers' adoption of 
high-speed broadband technology is simply unprecedented. A report from 
the Pew Internet and American Life Project found that 70 percent of 
homes have a broadband connection. If you include mobile broadband 
devices, 80 percent of U.S. households subscribe to broadband services.
    Perspective is helpful here. Thirteen years ago--when just half of 
all adults were ``online'' in some fashion--only 3 million households 
subscribed to broadband at home. Today, the Administration reports that 
88 million households have chosen to take advantage of the 
opportunities presented by the digital economy. Americans have embraced 
broadband-enabled smartphones at an even faster pace. While the U.S. 
has just five percent of the world's population, we have over 50 
percent of global 4G mobile broadband subscribers. In fact, the U.S. 
adoption rates for wired and mobile broadband eclipse--in some cases by 
decades--the comparable adoption timeframes for personal computers, 
cable television, or the landline telephone.
    These positive trend lines extend to communities previously on the 
wrong side of the digital divide. Rural communities tend to adopt 
technologies later than urban and suburban areas. Through increased 
wired and wireless technology, rural areas will develop economically 
through GPS powered equipment, apps that help farmers more efficiently 
track their work and online retail to allow rural businesses to reach 
customers around the world. More of the rural population is able to 
access broadband every day through technologies like satellite and 
wireless. The Pew study on adoption found that 70 percent of the U.S. 
rural population currently has a home or mobile broadband connection.
    Since 2009, the percentage of African Americans that subscribe to 
broadband access has increased from 46 percent to 64 percent, while the 
broadband gap between whites and African-Americans declined from 19 
points to 10 points in that same period, according to Pew. And 49 
percent of African Americans own a smartphone, compared with 45 percent 
of whites.
    The Latino community has also taken great strides forward in 
broadband adoption, and programs by groups like the League of United 
Latin American Citizens (LULAC) have helped in this effort. LULAC 
sponsors technology centers in 25 states across the country, helping 
Latinos with computer training, job searches, and other digital skills 
that are necessary in today's high-tech world. Broadband for America 
believes in programs like this and early on provided financial support 
for LULAC's digital literacy campaign.
Partnering to Bridge the Digital Divide
    In the past few years, we have learned that building and deploying 
broadband--however complex and expensive--is the relatively simple part 
of this equation. As the pool of non-adopters shrinks, the challenge 
this Nation faces is to ensure that all Americans benefit from the 
broadband economy.
    The Adoption Challenge. Broadband for America applauds this 
Subcommittee for its efforts and leadership to support a sustained 
focus on broadband adoption. As the Nation's ISPs continue to deploy 
broadband, policymakers should concentrate on solutions aimed at 
encouraging all Americans to get online. To succeed, we will need all 
stakeholders to contribute.
    Despite the successes described above, too many Americans still 
face a digital divide--a divide with serious ramifications. The 
statistics are well documented. Fifteen percent of Americans choose not 
to use the Internet at all. The adoption challenge extends beyond 
apartments and homes. The digital divide is just as often a local 
issue, although not often framed as one.
    While the national adoption story is a promising, albeit incomplete 
one, these national figures can obscure regional and community-specific 
challenges. In some areas, broadband adoption dips to 50 percent. These 
pockets of non-adoption reinforce the need for locally targeted efforts 
that address the unique challenges of individual communities. Broadband 
can serve as a great equalizer, opening opportunities to all people 
regardless of economic background, geography, or age. But first, high-
speed Internet must not only be available, but also relatable.
    People choose not to go online at home for complex and intertwined 
reasons, making one-size-fits-all public policy solutions challenging. 
Pew has done important work in this area. In September, they recently 
released some valuable findings as to why people use the Internet but 
do not adopt a broadband connection at home:

   26 percent find the Internet is not relevant or usable;

   20 percent think computers are too expensive or do not have 
        a computer;

   9 percent think an Internet connection is too expensive, or 
        it is cheaper elsewhere.

    This shows that relevance and digital literacy are central to 
solving the broadband adoption problem and Internet connection cost is 
lower on the order of importance.
    I note that the FCC will be considering digital literacy and 
adoption issues at its open meeting on November 14. The Commission will 
hear updates on several innovative programs focused on improving 
digital literacy.
    The Path Forward. A multifaceted problem requires a multifaceted 
solution, and one that need not--and should not--be carrier or 
government-centric. This is first and foremost a challenge of inclusion 
and outreach. For broadband adoption efforts to succeed, we need 
persistent and sustained efforts. We need community engagement, through 
developing partnerships with groups like the United Way and Big 
Brothers/Big Sisters. We need to empower partners in our neighborhoods 
and direct relevant messages to underserved communities. Working 
together, we can solve the question of how to connect the dots in each 
non-adopting home and business in a smart and focused manner.
    Targeted government action can play a role in improving broadband 
adoption by specifically engaging community leaders, providing the 
necessary tools, and sharing best practices to get non-adopters online. 
The government's core role is one of facilitator. For example, earlier 
this year, NTIA released its Broadband Adoption Toolkit. NTIA 
recognized that non-adoption is often driven by multiple, interwoven 
factors--perception, access, cost, skills, and relevance--that together 
can form a complex barrier to broadband connectivity. The Toolkit 
emphasized ``concrete, field-tested'' methods and practices in areas 
like curriculum development and training delivery to improve digital 
literacy and engage those not yet online. This effort and many other 
promising outreach models recognize that different communities will 
need different adoption strategies as well as a sustained dialogue with 
community leaders.
    Other aspects of adoption need attention by both government leaders 
and private companies. To many people the Internet does not play a 
large enough role in their life to deem purchasing a broadband 
connection necessary. By incorporating broadband into areas like health 
care, education, transportation and the smart grid, more people will 
find reasons to adopt broadband connections. In many cases, adopting 
broadband is beneficial for consumers. Telemedicine saves money by 
preventing costly hospital stays. For instance, the Department of 
Veterans Affairs' home telehealth program resulted in a 25 percent 
reduction in in the average number of days hospitalized and a 19 
percent reduction in hospitalizations. Smart grid systems save 
consumers money every month. Initiatives by the government and private 
companies will make these programs and technologies relevant to the 
lives of more Americans.
    Government can also help maintain--and facilitate--innovative and 
affordable broadband packages geared to non-adopters. Common sense 
policies, like permanently extending the Internet Tax Moratorium, will 
help ensure broadband prices stay reasonable. This historic 
legislation, first introduced by former Senator Dan Inouye and myself, 
banned states and localities from placing discriminatory taxes on 
broadband access. Over the next decade, this tax moratorium was 
extended twice with bipartisan support. As a result, Internet adoption 
has increased and more entrepreneurs have accessed new markets 
increasing their consumer reach across America.
    The government should also ensure that regulations do not hinder or 
crowd out investment in the broadband and Internet industries. The 
largest private investors in the U.S. are broadband providers; their 
work building out our networks is preparing the U.S. for the economy of 
tomorrow. Deviating from the light touch regulatory model that has been 
in place since the Clinton administration would likely reduce 
investment that helps extend faster broadband services to more people 
across the country.
    Changes in broadband providers' pricing models could also bring 
more people online through a more equitable system. The current 
unlimited-use pricing model has light and moderate users paying the 
same as heavy users, essentially subsidizing heavy broadband use. A 
system that charges customers on the amount of data used would begin to 
reverse this trend. This pricing model would also help close the 
adoption gap by offering additional choices for consumers that more 
closely match their needs and ability to pay.
    Further, the FCC should continue to recognize the pro-consumer 
benefits of new pricing and packaging models. Experimentation with 
speeds, data allowances, and price points is fundamental to providers' 
ability to deliver broadband that is right sized for all consumers and 
businesses.
    Relatedly, the Nation must make a commitment to digital literacy. 
For the country's sustained global competitiveness, digital literacy 
should be a part of every American's rite of passage. As a father of 
three, I have seen firsthand the power of broadband and technology on 
kids. As broadband connectivity transforms our educational system, 
schoolchildren increasingly need broadband access both in the classroom 
and at home.
    Broadband providers are addressing adoption issues head on. 
Broadband for America members, such as Comcast and CenturyLink, offer 
Internet packages for $9.95 per month, along with a low priced 
Internet-ready computer and free digital literacy classes. Only 22 
months after inception, Comcast's Internet Essentials program is being 
used by over 900,000 low-income Americans. Verizon and Time Warner 
Cable both have programs that encourage students to get involved in 
Science, Technology, Engineering, and Math (STEM)-related activities in 
their communities. Verizon's Innovative App Challenge offers prizes to 
teams of students who develop mobile and tablet based apps for use in 
middle and high school STEM classes. Time Warner Cable has invested 
$100 million into its Connect a Million Minds campaign, the program 
helps students get involved in STEM activities through innovative 
online resources, affordable after-school activities, and grants to 
nonprofits that support STEM education. AT&T has contributed and 
committed $350 million as part of its Aspire program since 2008. Aspire 
specifically helps kids stay on track to graduate high school and be 
ready for the hi-tech future which awaits them--and includes digital 
literacy as it reaches kids in our underserved neighborhoods. Bright 
House Networks is providing $2 million of in-kind support to 1,667 
schools through its Cable in the Classroom program. These wrap-around 
solutions will continue to help address the core challenges of non-
adoption.
    We appreciate the opportunity to share our views on this important 
issue. Broadband for American looks forward to working with Congress to 
help promote increased broadband adoption and utilization. I look 
forward to answering any questions you may have.

    Senator Pryor. Thank you.
    Mr. Smith.

         STATEMENT OF AARON SMITH, SENIOR RESEARCHER, 
             PEW RESEARCH CENTER'S INTERNET PROJECT

    Mr. Smith. Thank you for having me here today. My name's 
Aaron Smith. I'm a Senior Researcher at the Pew Research 
Center's Internet Project. We're a nonprofit research 
organization, here in D.C., funded by the Pew Charitable 
Trusts, and my project has been conducting national consumer 
surveys of Internet use and broadband adoption since early 
2000. And my organization does not promote specific policy 
positions, but I hope that my comments can provide a better 
understanding of the current state of broadband adoption, which 
groups have low levels of broadband use, and also the major 
factors that are preventing people from adopting broadband.
    So, when we first conducted our survey of broadband 
adoption in 2000, just 3 percent of Americans had some sort of 
broadband connection at home. And, as John noted, that figure 
has risen to 70 percent of Americans, as of our most recent 
survey, in May of this year. But, despite this long-term growth 
trend, the pace of broadband adoption has slowed substantially 
in recent years. After increasing by an average of nearly 7 
percentage points per year from 2000 through 2009, the national 
broadband level--adoption level increased by a total of just 7 
percentage points from 2009 through 2013.
    Although 70 percent of the American public has a high-speed 
Internet connection at home, that figure is lower among certain 
groups than among others. Broadband adoption levels are 
especially low among three demographic groups in particular. 
The first group is older adults. Just 43 percent of Americans 
age 65 and older have a broadband connection at home. The 
second group is people with low levels of educational 
attainment. Among Americans who have not received a high school 
diploma, just 37 percent are broadband adopters. And the third 
group is people with low household incomes. Fifty-four percent 
of Americans with a household income of less than $30,000 are 
broadband adopters.
    Now, these are not the only group--these are not the only 
groups for whom broadband adoption levels are low. As John also 
mentioned, rural residents are less likely to have broadband 
than urban and suburban residents, and African Americans and 
Latinos are less likely to have broadband than whites. Also, 
broadband adoption is low among people with physical 
disabilities or with chronic health conditions. But, overall, 
age and socioeconomic status are the demographic factors that 
are most strongly correlated with whether someone has broadband 
or not.
    So, since 70 percent of the public does have some sort of 
broadband connection at home, that means that 30 percent of the 
adult population does not have high-speed home access. That 30 
percent of Americans includes two distinct groups, each of 
which faces distinct challenges and barriers to adoption.
    The first of those groups are the 15 percent of the adult 
population that do not use the Internet at all. This group is 
significantly older than the population as a whole, with a 
median age of 64 years old. These non-users tend to have little 
connection to the online world and often face significant 
challenges, in terms of their comfort level with technology. 
Just 17 of these non-users feel confident that they could go 
online without assistance if they chose to do so in the future.
    And when we asked these non-users to tell us the main 
reasons why they don't go online, they tend to point to their 
perceptions of the relevance of online content and their 
challenges using technology, in general. One-third of these 
non-users say things like they just aren't interested in going 
online, don't need to go online, or think the Internet is a 
waste of time. And a similar number mention usability-related 
issues, such as finding it difficult or frustrating to go 
online, saying they don't know how to go online or are too old 
to learn, or that they're physically unable to use a computer.
    The second group of nonbroadband adopters, which also makes 
up 15 percent of the population, includes people who do use the 
Internet from one location or another but do not have high-
speed access within their home. In contrast to the non-Internet 
user population, this group is much younger. Around half of 
them are under the age of 45. They also tend to have relatively 
low incomes, relatively low levels of educational attainment, 
and include a relatively large number of non-whites.
    Also in contrast to the non-Internet users I discussed a 
moment ago, issues related to price and affordability are this 
group's primary barrier to adoption. When we asked them why 
they don't have Internet service at home, 42 percent of 
Internet users who lack home broadband cite financial issues, 
such as not having a computer, not being able to afford 
Internet service, or having a cheaper option for access outside 
of the home.
    In summary, three out of every ten Americans currently do 
not have broadband service at home, and many of these 
individuals face substantial hurdles to adoption. Some, 
especially working-age adults at the lower end of the income 
spectrum, see the value of broadband but simply lack the 
necessary financial resources. But, others face significant 
challenges using technology or do not see the benefits of 
broadband access in the first place. For this group of non-
adopters, a lower price may be necessary, but not sufficient. 
They will likely require a great deal of coaching and 
encouragement before they are ready to join the broadband 
world.
    Thank you again for your time and for inviting me to speak 
on the subject. I look forward to any questions you have.
    [The prepared statement of Mr. Smith follows:]

         Prepared Statement of Aaron Smith, Senior Researcher, 
                 Pew Research Center's Internet Project

    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to testify today.
    My name is Aaron Smith, and I am a senior researcher with the Pew 
Research Center's Internet Project. The Pew Research Center is a non-
profit research organization funded primarily by the Pew Charitable 
Trusts, and its Internet project has been conducting national surveys 
of Internet use and broadband adoption since early 2000.
    The Pew Research Center and its experts do not promote specific 
policy positions, but I do hope that my comments can provide a better 
understanding of the current state of broadband adoption; which groups 
have low levels of broadband use; and the major factors preventing 
people from adopting.
National trends in broadband adoption
    When we conducted our first survey of broadband adoption in early 
2000, just 3 percent of American adults had some sort of broadband 
connection at home. That figure has risen to 70 percent of Americans as 
of our most recent survey in May of this year.
    But despite this long-term growth trend, the pace of broadband 
adoption has slowed substantially in recent years. After increasing by 
an average of nearly seven percentage points per year from 2000 through 
2009, the national broadband adoption level increased by a total of 
just seven percentage points from 2009 through 2013.
Demographic differences in broadband adoption
    Although 70 percent of the American public has a high-speed 
Internet connection at home, that figure is lower among some groups 
than among others. Broadband adoption levels are especially low among 
three demographic groups in particular.
    The first group is older adults. Today just 43 percent of Americans 
age 65 and older have a broadband connection at home, which is roughly 
half the adoption rate for those between the ages of 18 and 49.
    The second group is people with low levels of educational 
attainment. Among Americans who have not received a high school 
diploma, just 37 percent are broadband adopters. By comparison, nine in 
ten college graduates have broadband at home.
    The third group is people with low household incomes. 54 percent of 
Americans with an annual household income of less than $30,000 are 
broadband adopters.
    These are not the only groups for whom broadband adoption levels 
are low. Rural residents are less likely to have broadband than urban 
or suburban residents; African Americans and Latinos are less likely to 
have broadband than whites; and broadband adoption is also low among 
people with physical disabilities or severe chronic health conditions. 
But overall, age and socio-economic status are the demographic factors 
most strongly correlated with whether someone has broadband or not.
Non-broadband users and their reasons for non-adoption
    Since 70 percent of the public does have some sort of broadband 
connection at home, that means that 30 percent of the adult population 
does not have high speed home access. That 30 percent of Americans 
includes two distinct groups, each of which faces different challenges 
and barriers to adoption.
    The first group is the 15 percent of the adult population that does 
not use the Internet at all. This group is significantly older than the 
population as whole, with a median age of 64 years old.
    These non-users tend to have little connection to the online world, 
and they often face significant challenges in terms of their comfort 
level with technology. Just 17 percent of these non-users feel 
confident that they could go online on their own if they chose to do so 
in the future, while 63 percent say that they would need someone to 
assist them.
    When we ask these non-users to tell us the main reason why they 
don't go online, they tend to point to their perceptions of the 
relevance online content and their challenges using technology in 
general. One third of these non-users say things like: they just aren't 
interested in going online; don't need to go online; or think the 
Internet is a waste of time. And a similar number mention usability-
related issues such as: finding it to difficult or frustrating to go 
online; saying that they don't know how to go online or are too old to 
learn; or are physically unable to use a computer.
    The second group of non-broadband adopters, which also makes up 15 
percent of the population, includes people who do use the Internet from 
one location or another, but do not have high speed access within their 
home.
    In contrast to the non-internet-user population, this group is much 
younger--around half of them are under the age of 45. They also tend to 
have relatively low incomes, relatively low levels of educational 
attainment, and include a relatively large number of non-whites.
    Also in contrast to non-internet-users, issues related to price and 
affordability are this group's primary barrier to adoption. When asked 
why they do not have Internet service at home, 42 percent of Internet 
users who lack home broadband cite financial issues such as: not having 
a computer; not being able to afford Internet service; or having a 
cheaper option for access outside the home.
Summary
    In summary, three out of every ten Americans currently do not have 
broadband service at home, and many of these individuals face 
substantial hurdles to adoption. Some--especially working-age adults at 
the lower end of the income spectrum--see the value of broadband but 
simply lack the necessary financial resources. But others face 
significant challenges using technology, or do not see the benefits of 
broadband access in the first place. For this group of non-adopters, a 
lower price may be necessary but not sufficient--they will likely 
require a great deal of coaching and encouragement before they are 
ready to join the broadband world.
    Thank you again for inviting me to speak on this subject.

    Senator Pryor. Thank you.
    Ms. Joselyn.

  STATEMENT OF BERNADINE JOSELYN, DIRECTOR, PUBLIC POLICY AND 
                 ENGAGEMENT, BLANDIN FOUNDATION

    Ms. Joselyn. Good morning, Chairman Pryor, Senator Wicker, 
members of the Committee.
    I bring you, today, the voices and experiences of rural 
community leaders. These are the people who create vibrancy 
across the American landscape.
    They are hopeful people, and they can make a little support 
go a long way. For example, Janice Gale, Director of the Leach 
Lake Band of Ojibwe's Temporary Employment Program, saw, every 
day, how temporary tribal members without work struggled with 
technology when applying for jobs. She worked with us and 
partners to create sustainable systems for creating culturally 
relevant online job search and work skills and to expand 
computer and Internet access on her reservation. Tribal members 
who upgrade their digital literacy skills now qualify for 
higher pay. Janice smiles with pride when she tells of the 
workers in her program who have been inspired to pursue a GED.
    Multiply Janice Gale times hundreds and the stories 
continue to roll in from communities all across rural 
Minnesota, where broadband adoption is not just a policy 
imperative, it's a community imperative.
    Blandin Foundation works with rural communities in 
Minnesota. We have made broadband adoption a priority, because 
we believe that broadband is the indispensable infrastructure 
of the 21st century, and rural communities need broadband 
access, and the ability to use it, in order to thrive in this 
globalized economy.
    One of our projects, the Minnesota Intelligent Rural 
Communities Initiative, MIRC, had the support of the American 
people through the American Recovery and Reinvestment Act. 
Blandin Foundation administered MIRC on behalf of a coalition 
of 19 statewide partners and 11 rural communities. Our work was 
funded partially through the federally-funded Broadband 
Technology Opportunity Program, BTOP, one of 44 sustainable 
adoption grants awarded nationwide. Through MIRC, we sought to 
support and encourage broadband adoption as a strategy for job 
growth and wealth creation, to increase the culture of use of 
broadband services, and to improve efficiency and effectiveness 
of digital literacy training. In sum, helping rural communities 
keep up globally was our real task.
    MIRC set measurable goals. All were accomplished or 
exceeded, and the details have been submitted for the record. 
Here's just one highlight:
    Broadband adoption in participating MIRC communities grew 
15 percent faster than in the rest of rural Minnesota. But, 
subscription rates tell only part of the story, and not even 
the most important part. Here are just a few examples:
    The town of Thief River Falls launched a collaboration 
between local broadband providers and a nonprofit to supply 
refurbished computers, subsidized broadband subscriptions, and 
digital literacy courses to low-income families. And 84 percent 
of these first-time computer owners have continued their 
broadband subscriptions after the subsidies ended.
    In the small town of Akeley, Minnesota, the business 
community built a series of peer-led technology workshops that 
have helped entrepreneurs bring their businesses to the next 
level using more sophisticated Internet-based tools.
    An immigrant center in Winona, Minnesota, launched digital 
literacy training in Hmong and Spanish for recent immigrants.
    A consortium of nine districts in Stevens County in 
southern Minnesota developed a broadband-based distance 
learning service for students with disabilities.
    This is complex work, with many moving parts. But, I can 
state succinctly the policy implications. Access to broadband 
is key, but so is adoption, and community-based community-
engagement efforts work.
    I'd like to close with just one more voice, that of Kristen 
Fake, a small-business owner in Akeley, Minnesota when she was 
describing the impact of MIRC on her town. She said, ``We've 
turned a corner and become a community that's actually growing 
and thriving.''
    And persuaded by the effectiveness and impact of these 
efforts, and mindful of the critical role that broadband access 
and adoption plays in the economic and social life of rural 
places, Blandin Foundation's Board of Trustees has committed an 
additional $1.5 million to continue to support broadband 
adoption efforts in rural Minnesota in 2013 and 2014, and we 
look forward to continued opportunities to partner with the 
Federal Government in that important work.
    Thank you. [The prepared statement of Ms. Joselyn follows:]

 Prepared Statement of Bernadine Joselyn, Director, Public Policy and 
                     Engagement, Blandin Foundation
    Chairman Pryor, Senator Wicker, Members of the Committee

    I bring to you today the voices of rural community leaders. These 
are the people who are engines of vibrancy across the American 
landscape. They are strong, hopeful people and they can make a little 
support go a very long way.
    When we met Kristin Fake, a sole proprietor in tourism-dependent 
Akeley, Minnesota, it was a leap of faith for her to come to the 
workshop hosted by the University of Minnesota Extension Service, one 
of our partners in our broadband work. Like so many, she couldn't 
imagine how technology might benefit her home staging business. At the 
workshop she quickly discovered that her clients were being misdirected 
by Google maps, how keywords drive inquiries, and how she might use a 
smart phone to dramatically improve her customer service. Her annual 
sales now are much higher than before she took the class and products 
she advertises on Facebook often are purchased before she even gets 
them displayed in her shop. Kristin is poised to take her business to a 
new level as Akeley continues to recover from a very tough economic 
patch.



    Kristin went from not being able to imagine how technology might be 
helpful to her business to creating demand for products and services 
that the marketplace hadn't yet imagined. Empowering people through 
technology also was the focus of our partnership with the Leech Lake 
Band of Ojibwe.
    Janice Gale, director of the Leech Lake Band's Temporary Employment 
Program, long had seen the digital challenges that her neighbors and 
workers faced in seeking even temporary employment. She quickly put to 
work the resources and relationships available through our network of 
partners to teach online job search and work skills, and to expand the 
availability of computers on the reservation. A computer lab at the 
Boys and Girls Club, for example, attracts 250 students each month. 
Refurbished computers, training and subscriptions for kids and families 
were distributed through Head Start. Temporary workers who participate 
in the digital literacy program upgrade their skills and qualify for 
higher pay. Temporary Employment Program student workers help learners 
in the computer labs, which is a great benefit to both trainers and 
learners. Janice, in her quietly passionate way, grins when she tells 
how many participants have been inspired to pursue their GED.



    Multiply Kristin Fake and Janice Gale times hundreds. And the 
stories continue to roll in from communities all across rural 
Minnesota, where adoption is not just a policy imperative, but a 
community imperative.
    Blandin Foundation is a private foundation that has the unique 
privilege of working exclusively with rural communities in Minnesota. 
Based in Grand Rapids, Minnesota, we are one of only a handful of 
foundations nationwide so focused on rural communities, and we are the 
state's largest foundation located in a rural community.
    What we have learned over 75 years is that thriving communities are 
built on hard work. On the hard work of leadership, inclusion, reaching 
across differences and building lasting connections. On commitments, 
and on belonging--that indelible sense of place that is home.
    That's the fertile soil that healthy communities grow in. And 
that's what Blandin Foundation is about--helping people imagine, lead 
and grow vibrant, resilient, rural communities.
    From our experience, realizing the promise of the Internet is as 
much about investing in human capacity as it about investing in 
technological capacity. Maybe more.
    After a career in the Foreign Service, I became Blandin 
Foundation's first-ever public policy director in 2003. When I looked 
out over the rural landscape, one issue that stood out as having great 
potential to help rural communities thrive into the new century: access 
to high-speed Internet, and the capability to take advantage of its 
many social and economic benefits.
    Today the digital divide remains far too real for rural America. 
And especially real for those who face other types of barriers--
poverty, language, isolation. The work of bringing the promise of the 
Internet to all Americans clearly is not done.
    We believed in 2003, and still do today, that

  1.  Broadband is the indispensable infrastructure of the 21st 
        century, and

  2.  Rural communities need broadband access, and the ability to use 
        it, in order to thrive--and even survive--in an ever more 
        globalized world.
        
        

    To this end, Blandin Foundation has invested in a body of work 
focused on strengthening community broadband leadership and adoption. 
One of these projects, the Minnesota Intelligent Rural Communities 
Initiative (MIRC), had the support of the American people through the 
American Reinvestment and Recovery Act, which connected our work to 
national goals.
    Blandin Foundation administered MIRC on behalf of a coalition of 19 
statewide partners--regional development commissions, state workforce 
and education institutions, etc.--and 11 rural demonstration 
communities. Our work partially was funded through the Federal 
Broadband Technology Opportunity Program (BTOP), one of 44 sustainable 
adoption grants awarded nationwide.



    MIRC began in 2010 and was largely completed by the end of 2012, 
putting to work $4.8 million of Federal grant dollars, $1.8 million in 
matching funds and countless hours of work by community leaders to 
create a network of resources and support to rural Minnesota 
communities, business owners, students, health care facilities, local 
governments, the poor and un-and under-employed.
    Our aims were ambitious: to support and encourage vibrant rural 
economies through broadband adoption as a strategy for job growth and 
wealth creation; and to accelerate broadband adoption.
    Specifically, we sought to:

   Support and encourage vibrant rural economies through 
        broadband adoption as a strategy for job growth and wealth 
        creation.

   Increase ``culture of use'' of broadband services.

   Improve efficiency and effectiveness of digital literacy 
        training service delivery.

   Accelerate broadband adoption by two percent over its 
        statistically anticipated growth (increasing broadband 
        subscribers by 38,556 more than could otherwise be expected).

    In sum, helping rural communities keep up globally was our real 
task. Thanks to the Federal funding we received we were able to take on 
an ambitious, comprehensive, multi-sector effort that wove together 
work at the local community level, all the way up to state-wide 
engagement.
    MIRC set measurable goals. All were accomplished or exceeded:

----------------------------------------------------------------------------------------------------------------
                 Outcome                                 Goal                            Accomplished
----------------------------------------------------------------------------------------------------------------
New households subscribed to broadband               38,000 (2 percent above                              40,496
                                           statistically anticipated growth)
----------------------------------------------------------------------------------------------------------------
Number of public-access computer sites                                     0                                  60
----------------------------------------------------------------------------------------------------------------
Number of people who participate in at                                 3,640                               9,000
 least 16 hrs of training/
education
----------------------------------------------------------------------------------------------------------------
Refitted and licensed computers                                        1,000                               2,067
 distributed to first-time computer
 owners
----------------------------------------------------------------------------------------------------------------
Number of people reached through                                     160,000                             250,000
 outreach and awareness
----------------------------------------------------------------------------------------------------------------

    Overall, broadband adoption in participating communities grew close 
to 15 percent faster than in the rest of rural Minnesota. And 
communities that reported the highest rates of participation in MIRC 
activities also experienced the highest rates of broadband subscription 
growth.
    These data show that, without a doubt, rural communities across 
Minnesota moved the needle on project outcomes, especially with 
underserved residents and businesses.
    Dr. Jack Geller of the EDA Center at University of Minnesota-
Crookston and lead researcher for MIRC, concluded in his final 
evaluation that, ``It's hard not to connect the MIRC project . . . as a 
contributor to Minnesota's leading position in rural broadband 
adoption.''
    Persuaded by the effectiveness and impact of these efforts, and 
mindful of the critical role that broadband access and adoption play in 
the economic and social life of rural places, Blandin Foundation's 
Board of Trustees has committed an additional $1.5 million to continue 
to support broadband adoption efforts in rural Minnesota in 2013 and 
2014.
Our Approach to the Challenge of Broadband Adoption
    Blandin Foundation's community-based efforts take many forms, 
driven by the unique needs and interests of participating communities. 
Our strategies include:

   Offering individuals training in computer literacy and 
        knowledge worker career development strategies.

   Providing technical assistance and customized training to 
        small businesses and entrepreneurs.

   Distributing refurbished computers to low-income, rural 
        Minnesota residents.

   Partnering with Internet service providers to offer 
        subsidized subscriptions to connect those computers to the 
        Internet.

   Helping communities identify their unique goals and 
        providing the technical assistance and grant funding needed to 
        turn those goals into accomplishments.

    At the heart of our approach is high-touch, multi-sector, sustained 
community engagement. This includes community-wide visioning and goal 
setting and a community-driven grant proposal solicitation process to 
generate project ideas and community commitment upfront.
    To help drive home the recognition that broadband is a necessary 
but not sufficient element of economic development and community 
vitality, MIRC used indicators developed by the New York-based 
Intelligent Community Forum (ICF) to help communities baseline and 
measure their competitiveness in the broadband economy. These 
indicators include: ensuring broadband infrastructure, developing a 
``knowledge workforce'', supporting innovation, redressing the digital 
divide, and effectively using marketing and advocacy to tell the 
community's technology story.



    Community leaders used the ICF indicators to identify and select 
community projects that best fit local needs and focus their efforts on 
short term achievable goals that would have meaningful impact over the 
long term. More than 100 community-identified projects have been funded 
so far. Here are a few examples:
Ensuring the Availability and Use of Broadband Infrastructure
    Thief River Falls launched ``Computers for Our Community,'' a 
collaboration between local broadband providers and MIRC partner PCs 
for People. Over 18 months, the project delivered 126 refurbished 
computers, 91 reduced-rate broadband subscriptions, and nine multi-week 
digital literacy courses for low-income families. Most (84 percent) 
recipients continued their broadband subscriptions even after subsidies 
ended.
    Lac qui Parle County created a mobile computer lab that brings 
broadband access to one of Minnesota's most sparsely populated regions. 
A local partner testified: ``The Computer Commuter. . .connects patrons 
to people and places they had no idea they could connect to!''

Fostering Innovation
    An immigrant resource center in Winona launched digital literacy 
training in Hmong and Spanish for more than 60 recent immigrants. The 
project ``. . . built bridges among cultures and organizations'' and 
led to the realization that a ``connected city helps everyone.''



    A consortium of nine school districts in Stevens County developed a 
broadband-based system to provide specialized distance learning 
services for students with disabilities. Their takeaways: 
``[Realization] that the world is able to communicate and work 
cooperatively using technology; and, that the world is not limited to 
Stevens County.''
    Benton County added new computers in libraries, schools, and senior 
housing and created 13 new Wi-Fi access points in a variety of 
businesses and community sites, including an elder care facility. 
According to the county's economic director, ``Our elected officials 
now see the importance of broadband for economic development and 
community vitality.''

Deleting the Digital Divide
    MIRC partner and nonprofit PCs for People, in addition to 
surpassing their goal to refurbish and redistribute 1,000 computers to 
low-income rural households, opened affiliate storefronts in four rural 
Minnesota communities in each corner of the state. Said one computer 
recipient: ``I've gone back to school; I have two kids and now I don't 
have to go to the library and find a sitter to do research. . .I can 
stay home with my kids.'' When expressing her appreciation for 
receiving a computer and Internet connection, another recipient 
explained that the computer was going to be a Christmas present for her 
child; receiving it meant that she wouldn't have to choose between 
buying gifts or feeding her kids over the Christmas break.

Building a Knowledge Workforce
    Cook County opened a computer lab as part of a higher education 
distance learning partnership. During the project's 18 months, the site 
provided 21 training sessions attended by 185 people in this remote 
community with a population of 1,351. The lab continues to be available 
to all community residents and is used as a public Internet-access site 
and distance learning resource. The partnership offers credit courses 
from more than 25 institutions of higher learning.
Marketing and Advocacy (The capacity to advocate for change within the 
        community and market themselves to the world)
    A local-access television station in Itasca County upgraded its 
software, hardware and website interface to live stream and archive 
public meetings online. The move has improved access to these meetings 
for permanent and seasonal residents. Several other communities 
enhanced their government and business online presence, including 
Windom in far southwest Minnesota, which planned, launched and 
continues to maintain the ``Finding Windom'' community portal web 
presence.


    Here is a sampling of some the voices of rural Minnesotans who 
participated in MIRC reflecting on the impact of these broadband 
adoption efforts on their overall community vitality:

        ``We've turned a corner and become a community that's actually 
        growing and thriving instead of stagnant and dying, with what 
        we've learned from the MIRC program.''--Kristin Fake, owner, 
        Just a Stage/Second Stage home staging, Akeley, MN

        ``This project has permanently changed the way we think and the 
        way we work together.''--Della Schmidt, Winona Area Chamber of 
        Commerce, Winona, MN

        ``These technology classes have encouraged our Hispanic and 
        Somali immigrants to interact, really for the first time.''--
        Fatima Said, Project FINE, Winona, MN

        ``This effort has helped us develop wonderful community 
        connections. We have reached out to our whole community.''--
        Keri Bergeston, Principal, Dawson/Boyd (MN) High School

        ``MIRC efforts have really contributed to creating a 'Culture 
        of Use' amongst tribal members. Overall, MIRC has helped the 
        Leech Lake Reservation increase the economic vitality of our 
        community. Tribal community member are more familiar with the 
        tools of broadband and the economic opportunities that are 
        available.''--Mike Jones, Chief of Staff to Tribal Chair, Leech 
        Lake Band of Ojibwe, Walker, MN

        ``This framework brings people together that have not always 
        worked together--technology advocates, workforce, social 
        service agencies, and economic development professionals.''--
        Danna MacKenzie, Cook County (MN) IT Director

        ``The families in our community will see benefits for many 
        years to come as a result of everyone's hard work and 
        dedication on this project.''--Kristen Lee, Independent School 
        District #381, Two Harbors, MN
Lessons Learned: Key Elements of Successful Adoption Efforts
I. Communities know best.
    Involve citizens directly in articulating their community's 
broadband adoption and utilization goals to catalyze long-term 
engagement needed to increase adoption.
II. Local Leadership matters.
    Help local broadband champions get and use skills to frame issue, 
build and sustain relationships and mobilize people to build a 
community's capacity to achieve its broadband goals.
III. Broadband is not an end in itself.
    It is a means to the higher ends of increased economic vitality and 
improved quality of life. Framing it this way helps.
IV. High touch outreach works.
    Effective recruitment strategies are intra-community, hyper local, 
and personalized. Change follows relationship lines.
V. Peers make great teachers.
    Peer-based learning formats are popular, low cost and easily 
sustainable tools to build a community's technological savvy.
VI. Cross-community communication is key.
    Signage, local media support, and aligned social media are 
effective low-cost ways to spur and sustain energy and excitement for 
community projects.
VII. Engage tomorrow's leaders today.
    Recognize and authentically engage the talents of young people. 
This generation of leaders brings energy and sustainability to any 
community initiative.
VIII. Connect the economic dots.
    Framing increased sustainable broadband use as a necessary but not 
sufficient ingredient in a ``whole systems'' approach to strengthen 
community vitality can help communities see and leverage the connection 
between the technology and benefits to community life.
IX. Have patience.
    This work takes time. Look for and celebrate early and easy 
``wins,'' but think long term and build capacity and energy for the 
long haul. Money and other resources follow vision and commitment.

Conclusions and Policy Implications
    In service to the work of this committee and anyone working to 
strengthen rural communities, Blandin Foundation commends to you these 
key conclusions that we have drawn from our experience:

   Broadband access alone is not enough: without concerted, 
        community-based efforts to ensure that all citizens are able to 
        take advantage of the Internet, the digital divide will 
        continue to grow and to undermine America's promise as a 
        democracy where equal opportunity is available to all.

   Community-based broadband literacy and market development 
        efforts can and do help ensure that all Americans can 
        participate fully in our Nation's economy and civic and 
        cultural life.

   Eliminating the digital divide is an urgent challenge that 
        must be part of our national agenda. States and communities 
        need the Federal Government and its resources as a partner in 
        this work.

   Federal investment in broadband access and adoption made 
        available to Minnesota through the American Recovery and 
        Reinvestment Act have made a significant positive difference to 
        rural Minnesota communities' ability to be globally competitive 
        and ensure a high quality of life for their residents.

   NTIA has been a very helpful partner in our efforts to bring 
        to rural Minnesota communities the full benefits of the 
        broadband-enabled economy. NTIA's ``Broadband Adoption 
        Toolkit,'' released in May of this year, is an especially 
        powerful tool for shining a light on best practices, and making 
        them available to community champions across the country.

    In sum, access to broadband is key: Evidence abounds that high-
speed Internet access has economic benefits (positive impact on median 
household income, employment, and business growth).
    But so is adoption. According to the report, ``Broadband's 
Contribution to Economic Health in Rural Areas: A Causal Analysis,'' by 
B. Whitacre, S. Strover, and R. Gallardo (March 26, 2013), ``Non-metro 
counties with high levels of broadband adoption in 2010 had 
significantly higher growth in median household income between 2001 and 
2010 compared to counties that had similar characteristics in the 1990s 
but were not as successful at adopting broadband.''
    This point was eloquently echoed in a recent edition of ``The Daily 
Yonder,'' published on the web by the Center for Rural Strategies, a 
non-profit media organization based in Whitesburg, Kentucky, and 
Knoxville, Tennessee.

        ``While most government broadband policies have traditionally 
        focused exclusively on providing infrastructure, there is a 
        case to be made for focusing on demand. . . . Investments in 
        people, education and training are essential to achieve 
        meaningful use of the Internet.''

    On behalf of Blandin Foundation, our partners, and the people of 
rural Minnesota and rural America who work at broadband adoption every 
day, it is our honor to share our work with you and others. I trust 
that we have demonstrated how, in rural communities especially, support 
for broadband adoption can be stretched a very long way.
_______________________________________________________________________

    [The witness also submitted Minnesota Intelligent Rural Communities 
Program--Demonstration Communities final report

    by Robert Bell
    Intelligent Community Forum

    A report commissioned by the Blandin Foundation to support the work 
of the Minnesota Intelligent Rural Communities Coalition and Funded by 
the American Recovery and Reinvestment Act http://
blandinfoundation.org/--uls/resources/MIRC_ICF_Final_Report-04-08-
13.pdf ]

    Senator Pryor. Thank you.
    Ms. McPeak.

          STATEMENT OF SUNNE WRIGHT McPEAK, PRESIDENT

        AND CHIEF EXECUTIVE OFFICER, CALIFORNIA EMERGING

                        TECHNOLOGY FUND

    Ms. McPeak. Thank you for inviting me to share the 
experience from California. In California, which has some of 
the most challenging terrain for broadband deployment of any 
state and the largest population of people who were not online 
when we began the effort, we have made very significant 
progress, with bipartisan leadership.
    The California Emerging Technology Fund that I represent 
was established by the California Public Utilities Commission 
as a result of mergers of telecom companies in 2005. But, in 
addition, our Governor and legislature first had a broadband 
task force and now have established a broadband council in 
statute.
    The CPUC has established a fund converted from high-cost 
subsidies for telephony to support broadband deployment. And 
recently, the legislature and the Governor allowed that fund to 
be used to support broadband connectivity in publicly 
subsidized housing. In addition, through executive order, our 
Governor has said digital literacy is a priority for our state. 
So, we're committed to closing the digital divide.
    When we began, however, it was like having five states 
inside California, with respect to the geography that wasn't 
covered with deployment and who hadn't adopted. We had the 
national average for adoption at 55 percent, and Internet use 
overall at 75 percent. We've now increased that to having 
broadband use at 76 percent at home, and Internet use that 
exceeds 80 percent. Very significantly, we've increased low-
income households by 20 percentage points, Latino households by 
18 percentage points, people with disabilities by 20 percentage 
points, and our rural adoption has caught up with urban, 
because we couple adoption with deployment in California. 
However, those now left offline, left to adopt, are largely 
urban poor and those in rural areas that have no access at all.
    With all of this effort in California, we need to have an 
increasing partnership--set of partnerships between the Federal 
Government and the State, public and private partnerships, and 
provider and community partnerships. To be sure, California has 
benefited from being a partner with the Federal Government. We 
received, from the FCC, over $22 million for a Telehealth 
network. We were a grantee, under the NTIA BTOP program, of 
$14.3 million for 19 community-based organizations. And I 
should hasten to say, we met or exceeded our contract 
obligations, achieving more than 200,000 adoptions, people who 
actually adopted broadband for the first time subscribed, and 
generating more than 2700 jobs. So, we have been, I think--
benefited greatly by this partnership from the Federal 
Government.
    I come here today to share with you what more you can do. 
Clearly, there is a huge resource in the FCC with their powers 
and their resources, and NTIA Director Larry Strickling and his 
team have a wealth of knowledge about what works and 
relationships with states and nonprofits throughout the country 
that you've already invested in, that is an asset that should 
be capitalized upon.
    In terms of our learnings and recommendations for action, 
here's what we want to suggest:
    First, there is no substitute for leadership and for 
Congress setting explicit goals, with performance metrics and a 
timetable to achieve them, on adoption. A focus on getting 
results is essential.
    Second, there is a need to connect the dots at the Federal 
level across bureaucratic silos and to encourage each of the 
Federal departments to optimize the use of broadband and 
information technology in every one of their programs. We have 
provided you very specific examples that we can elaborate upon.
    Next, broadband needs to be integrated into every program. 
And I dare say that we're probably not going to be able to 
achieve adoption in low-income communities without a broadband 
lifeline program that is established at the FCC.
    We also have huge benefit in the investment already through 
NTIA BTOP grants, and would suggest that an additional prudent 
investment in broadband adoption that is done in partnerships 
with the states, with the private sector and community 
organizations, who are the trusted messengers and honest 
brokers, would go a long ways to closing the digital divide.
    And last, we would hope that it would be the hallmark of a 
congressional directive on closing the digital divide and 
improving, increasing adoption, that, indeed, we do it, as I've 
said before, through partnerships with states, with the private 
sector, and with community organizations.
    [The prepared statement of Ms. McPeak follows:]

    Prepared Statement of Sunne Wright McPeak, President and Chief 
         Executive Officer, California Emerging Technology Fund

Closing the Digital Divide is an Imperative
    Imagine if you were not able to communicate instantaneously with 
others using your smart phone, digital tablet, or computer. That is the 
reality for more than 9 million Californians who live in remote rural 
communities, on tribal lands, in low-income neighborhoods, or who have 
a disability. Those of us who have the benefit of a personal computing 
device coupled with high-speed connections to the Internet--referred to 
generically as ``broadband'' that includes both wireline and wireless 
technologies--have come to depend on this connectivity for our work, 
staying in touch with family and friends, and making our daily lives 
easier.
    Broadband is essential 21st century infrastructure for global 
competiveness. It is a key factor in attracting capital investment to 
generate jobs. Communities without broadband are being left behind in 
the Digital Age--remote rural areas, poor urban neighborhoods, and 
people with disabilities are even more disadvantaged without broadband 
availability and computing devices to access the Internet. Closing the 
Digital Divide with public policies and strategies to achieve 
ubiquitous broadband deployment and to accelerate broadband adoption is 
an imperative for economic prosperity, quality of life, and family 
self-sufficiency. Fortunately, it is a goal that can be achieved with 
inspired vision, focused leadership, alignment of existing resources, 
and enlightened investment of a modest amount of additional public 
funding to encourage partnerships--federal-state, public-private, and 
provider-community. There is ample research and empirical evidence 
about what it takes to get the job done.
The California Experience and Progress in Closing the Digital Divide
    California has some of the most challenging terrain in the Nation 
for broadband deployment and the largest populations of disadvantaged 
residents as priority communities for broadband adoption. When 
California began to focus on closing the Digital Divide, the number of 
``unconnected'' residents was the equivalent of having 5 other states 
within our boundaries. Approximately 94 percent of all residents had 
broadband access--however the 6 percent of residents totally unserved 
represented 768,000 households (about 2 million residents), more than 
the population of the State of Nebraska spread out over more than 
44,000 square miles of inhabited area, the size of the State of 
Kentucky. Almost 13 million residents (largely urban poor) were not 
connected, more population than the State of Illinois.
    In addition, 1.9 million people with disabilities were off-line, 
the population of the State of New Mexico. And, 680,000 Native 
Americans were not connected, larger than the population of the State 
of Alaska. It should be noted that California has the largest 
population of Native Americans than any other state with 111 federally-
recognized tribes. Most of the tribal lands lack broadband connectivity 
and want broadband access according to recent consultations of Tribal 
Leaders being convened by Judge Cynthia Gomez, the Governor's Liaison 
to Tribal Governments and the Executive Secretary of the California 
Native American Heritage Commission in collaboration with the 
California Emerging Technology Fund and the Corporation for Education 
Network Initiatives in California (CENIC).
    The California Emerging Technology Fund (CETF) was established at 
the direction of the California Public Utilities Commission (CPUC) in 
the orders approving the 2005 mergers of SBC-AT&T and Verizon-MCI. The 
successor companies agreed to provide a public benefit by contributing 
a total of $60 million into this new non-profit with the mission to 
close the Digital Divide in California. CETF became operational in 
2007, working in partnership with the Governor and State 
Administration, Legislature, CPUC, local governments, and a network of 
more than 80 community-based organizations (CBOs) to systematically 
implement a Strategic Action Plan to close the Digital Divide in 
California, tackling both broadband deployment and adoption challenges. 
CETF reports to the Legislature through the CPUC.
    In addition to establishing CETF, California policymakers have 
taken other key steps to close the Digital Divide, including:

   In 2007 the Governor with the support of the Legislature 
        convened the California Broadband Task Force which produced the 
        base report to focus attention on the issues.

   In 2008 the CPUC and the Legislature established the 
        California Advanced Services Fund (CSAF) to subsidize broadband 
        deployment to unserved and underserved areas by converting a 
        high-cost fund for telephone service to support broadband 
        infrastructure while also significantly reducing the annual 
        amount collected from consumers. Through subsequent legislation 
        the total amount authorized to be collected for CASF has been 
        increased to $315 million.

   In 2009 the Governor issued an Executive Order to advance 
        digital literacy that sets forth official State policy and 
        requires agencies to develop and implement an action plan.

   In 2010 the Legislature and Governor established the 
        California Broadband Council in statute to sustain State 
        attention and leadership to close the Digital Divide.

   In 2013 the Legislature and Governor authorized CASF funds 
        to be used for broadband connectivity in publicly-subsidized 
        multi-unit affordable housing.

    The sum total of this collective effort is significant progress in 
the last 6 years. In 2008, California's statewide adoption rate for 
Internet use was 70 percent with 55 percent having broadband use at 
home--the same as the national average. Today, 86 percent of 
Californians use the Internet and 75 percent access the Internet at 
home with a high speed connection (including 6 percent that access the 
Internet only by a mobile ``smart phone''). Also, there have been 
significant increases in broadband adoption by priority consumer 
populations:

    --Low-income households up 20 percentage points (from 33 percent in 
            2008 to 53 percent in 2013).

    --Latino households up 18 percentage points (from 34 percent in 
            2008 to 52 percent in 2013).

    --People with disabilities up 20 percentage points (from 36 percent 
            in 2008 to 56 percent in 2013).

The Role of the California Emerging Technology Fund
    The California Emerging Technology Fund (CETF) has been a pivotal 
partner in driving this progress on closing the Digital Divide, serving 
as a catalyst for focus, action and results by: (a) setting the goals 
for broadband deployment and adoption; (b) delineating the strategic 
framework to achieve the goals with regular reports on progress to 
foster accountability; and (c) making targeted and leveraged 
investments in public policy initiatives and grants to CBOs. CETF is 
performance-driven and outcomes-focused. The CETF Strategic Action Plan 
is based on research and fact finding about ``what works'' and sets 
forth the overall approach and strategies to close the Digital Divide, 
including the metrics for accountability that provide the disciplined 
focus on results. CETF set the following goals for achieving success by 
2017--10 years after CETF began operations--which have been embraced 
widely by policymakers and stakeholders.

    Broadband Supply--98 percent Deployment

   Access for At Least 98 percent of All Households

   Robust Rural-Urban California Telehealth Network (CTN)

   All Tribal Lands Connected and Part of CTN

    Broadband Demand--80 percent Adoption

   Overall Statewide Adoption At Least 80 percent by 2015 and 
        90 percent by 2020

   All Regions and Socioeconomic Groups within 10 Percentage 
        Points of Overall Adoption (At Least 70 percent)

   Increased Overall Accessibility and Universal Design

    Broadband Global Leadership--Within Top 3 Rankings

   Appropriate and Sufficient Speeds for Consumer Applications 
        that Drive Adoption

   Increased Economic Productivity

   Reduced Environmental Impacts

    There is not a ``silver bullet'' to closing the Digital Divide--no 
one strategy or action will get the job done. However, there is 
``silver buckshot''--a ``critical mass'' of inter-related and mutually-
reinforcing strategies and actions that do succeed. To achieve the 
optimal impact and a higher return on investment of the original seed 
capital, CETF employs 5 overarching strategies to drive progress on the 
broadband deployment and adoption goals:

  1.  Civic Leader Engagement

  2.  Venture Philanthropy Grantmaking

  3.  Public Policy Initiatives

  4.  Public Awareness and Education

  5.  Strategic Partnerships

    Successful implementation of these strategies requires engaging and 
partnering with ``trusted messengers'' and ``honest brokers'' who know 
their local communities and target neighborhoods, including local 
government officials, regional civic organizations, and successful 
CBOs. CETF has focused on 3 priorities for grantmaking: rural and 
remote areas; urban disadvantaged neighborhoods; and people with 
disabilities. CETF has awarded more than $31 million in grants to 
community-based organizations (CBOs) and public agencies as 
``partners'' in achieving the broadband deployment and adoption goals.
Leadership and Strategic Investments by the Federal Government
    California's progress in closing the Digital Divide has been 
significantly advanced by the leadership of the California 
Congressional Delegation and strategic investments by the Federal 
government. The Federal Communications Commission (FCC) awarded $22.1 
million from the Rural Health Care Pilot Program (matched by $3.6 
million from CETF) to connect a network of more than 800 facilities in 
rural and urban medically-underserved communities that comprise the 
California Telehealth Network (CTN). Telehealth is a major public 
policy initiative in California to drive both broadband deployment and 
adoption. Thus, the FCC Healthcare Connect Fund is a vital resource for 
the future, although the program needs some refinement. In addition, 
California has benefited greatly from partnerships with the U.S. 
Department of Commerce National Telecommunications and Information 
Agency (NTIA) under the American Recovery and Reinvestment Act (ARRA) 
Broadband Technology Opportunities Program (BTOP).
    NTIA awarded 13 ARRA BTOP grants for broadband infrastructure 
deployment exceeding $428 million and 17 grants for broadband adoption 
totaling almost $122 million, including support for CTN operations and 
development of services. NTIA provided 2 grants to CETF for a total of 
$14,359,476 (matched by CETF $2,551,796) to support 19 CBOs (sub-
awardees) resulting in more than 200,000 broadband adoptions and more 
than 2,700 jobs, which met and exceeded the contractual performance 
objectives. These grants were concluded as of June 2013 and are 
summarized below.

Broadband Awareness and Adoption
    The Broadband Awareness and Adoption (BAA) project mobilized the 
expertise and resources of 8 partners (sub-awardees) to reach 
communities most impacted by the Digital Divide: low-income families,  
limited English-speaking Latinos,  rural residents and people with 
disabilities. BAA partners worked with schools, churches, health 
clinics, job training programs, and social service providers to develop 
model ``service ecosystems'' which included technical support, low-
price computers, and affordable broadband connections. Key 
accomplishments include:

   Increased awareness about the benefits of broadband among 
        13,296,068 low-income residents (266 percent).

   Provided 719,255 low-income individuals with basic Digital 
        Literacy skills to use broadband technology (106 percent goal).

   Achieved 198,714 new broadband subscriptions by low-income 
        households (149 percent goal) and distributed 6,866 computers 
        to low-income households (172 percent goal).

------------------------------------------------------------------------

------------------------------------------------------------------------
Total BAA Budget                                              $9,360,672
NTIA Grant                                                    $7,251,295
CETF Match Funds                                                $979,476
Partner Cash Match                                              $882,667
Partner In-Kind Match                                           $247,234
------------------------------------------------------------------------

Access to Careers in Technology
    The Access to Careers in Technology (ACT) project engaged 11 
partners (sub-awardees) to establish scalable workforce development 
programs while expanding access to broadband and 21st Century jobs in 
low-income communities throughout the state. Individuals with multiple 
barriers to employment--ranging from the homeless to former drug 
addicts--completed Information and Communications Technology (ICT) 
training to obtain jobs in a spectrum of major industries from 
engineering to entertainment with pathways to living-wage careers in 
high demand. Key accomplishments include:

   Trained 24,675 low-income youth and adults and 12,044 small 
        business owners and employees with Digital Literacy skills (101 
        percent goal).

   Secured 2,745 ICT career-path jobs for low-income residents 
        (107 percent goal).

   Achieved 9,331 new broadband subscriptions by low-income 
        households and distributed 5,547 computers to low-income 
        households (101 percent goal).

------------------------------------------------------------------------

------------------------------------------------------------------------
Total ACT Budget                                             $11,081,130
NTIA Grant                                                    $7,108,181
CETF Match Funds                                              $1,572,320
Partner Cash Match                                            $2,379,839
Partner In-Kind Match                                            $20,790
------------------------------------------------------------------------

Lessons Learned
    The successful implementation of the NTIA grants by CETF and our 19 
partners was led by Senior Vice President Susan Walters, who prepared a 
report Lessons Learned from the Field which has been submitted as part 
of this testimony for the Congressional record.

----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
                                 CETF Lessons Learned from ARRA NTIA BTOP Grants

                      Grantee executive leadership and staff management capacity are essential.

                      Coaching and the ``learning community'' were key to reaching goals.

                      Thoughtful work plans in advance led to faster recognition of problems.

                      Anchor institutions and community organizations need to work to ensure that
                               clients actually obtain broadband (information and encouragement alone are not
                               sufficient).

                      Integrating digital literacy training and broadband adoption into existing
                               programs is the best way to ensure sustainability and continually narrow the
                               Digital Divide.
----------------------------------------------------------------------------------------------------------------

    The experience of all NTIA grantees has been incorporated into the 
NTIA Took Kit which is a very useful compilation of data and 
recommendations for accelerating broadband adoption. NTIA Administrator 
Larry Strickling and his team (Laura Breeden and colleagues) have a 
wealth of knowledge about ``what works'' and established working 
relationships with state agencies and non-profit organizations 
throughout the Nation that are valuable assets that should be supported 
and leveraged for sustained progress in closing the Digital Divide.
Broadband Empowers People and Transforms Lives
    The California Emerging Technology Fund (CETF) has amble evidence 
about the ways in which broadband access and information technology 
empowers people and transforms lives. This is particularly effective 
when broadband is integrated into services and programs that have 
relevance to everyday living, such as in school, job training, housing, 
and healthcare.
    For example:

   CETF has developed School2Home to turn around low-performing 
        middle schools through the integration of broadband and 
        computing technology into the teaching and learning processes 
        with significant parent engagement. Not only is School2Home 
        improving academic performance above district and statewide 
        gains, but also driving broadband adoption: Spanish-speaking 
        parents increased broadband adoption at home from 48 percent to 
        76 percent (a 58 percent increase) and English-speaking parents 
        increased from 84 percent to 94 percent (a 12 percent 
        increase).

   CETF partner The Stride Center has a significant track 
        record in training and securing employment for individuals with 
        multiple barriers to employment, demonstrating that ICT 
        workforce preparation can result in 90 percent of the clients 
        obtaining jobs with a median wage double the overall regional 
        labor market average.

    The power of the statistics on closing the Digital Divide and 
performance data on the grants comes to life with the stories of the 
people who are becoming self-sufficient and productive taxpayers 
because of these public and private investments. Consider the 
experience of these real people who have benefited from broadband 
access and information technology:

    --Daniel made the honor roll once he had broadband at home and was 
            able to keep up with his homework assignments and navigate 
            the Internet to gather information.

    --Yanira was as a grocery delivery driver when she injured her back 
            and couldn't work in that job any longer. With an online 
            course she learned how to write a resume and cover letter, 
            search for job listings, and e-mail applications to 
            companies--when she began she didn't even know how to send 
            e-mails. After just a month, she started a new job in the 
            delivery business making nearly $3 more per hour.

    --Henri recently landed his first job as a digital animator after 
            receiving job training and now is on a career pathway with 
            living wages.

    --Rosa is getting her high school equivalency diploma after 
            completing two computer skills certification classes to 
            earn a free refurbished computer and signing up for 
            broadband at home.

    --Alicia used to struggle to find work, but now works fulltime 
            after learning how to use electronic job boards in a 
            digital literacy class.

    --Deborah was able to keep up with her high school homework with 
            the benefit of broadband access and graduated with a 4.0 
            GPA. She searched the Internet for the right college and 
            was able to apply online for admission and a full 
            scholarship.

    --Maria's flower shop has blossomed since attending a computer 
            training class and learning how to manage and market her 
            business.

    --Sheryl turned her live around from drug abuse and losing her 
            children after learning computer skills at a non-profit 
            that received ARRA funds from NTIA BTOP. Today she has a 
            full-time job, which allowed her to regain custody of her 
            children.

Conclusions for Closing the Digital Divide and Accelerating Broadband 
        Adoption
    Although there has been a steady rise in the number of people 
adopting and using broadband at home, it is becoming increasing harder 
to reach those who remain off-line because they are remote rural 
residents without access and urban poor residents without digital 
literacy skills nor the means to afford market prices. However, all the 
data and experience indicates that the vast majority of people who do 
not have or use broadband at home want to adopt the technology when 
they understand the value proposition and have access. Thus, it is very 
important to understand what actually works to reach these consumers 
who should be regarded as ``prospective customers in emerging 
markets.''
    Dr. John Horrigan (who helped develop the National Broadband Plan 
and has worked for the Pew Charitable Trusts and Joint Center for 
Political and Economic Studies) concludes that the cost of digital 
exclusion is real and rising and that the broadband adoption challenge 
has three primary dimensions: cost, relevance, and digital literacy. He 
further finds increasing broadband adoption requires sustaining 
capacity and scale of strategic initiatives with states and local 
communities involved in the ``ground game'' to focus on ``digital 
readiness'' in unserved and disadvantaged communities. He provides 
valuable insights to guide the work in accelerating broadband adoption.
    The following are the major conclusions from the experience of the 
California Emerging Technology Fund and our community-based partners 
who have been on the ground in unserved rural communities and 
disadvantaged urban neighborhoods.

   It is essential to set goals with quantified metrics and 
        accountability for performance in order to drive broadband 
        deployment and adoption to close the Digital Divide and to 
        regularly report to the public and stakeholders to ensure 
        continued focus on the goals.

   Optimizing impact of any investment requires engaging public 
        officials at all levels of government and civic leaders in 
        regional consortia and local communities. There is no 
        substitute for leadership, but leaders need to be involved in 
        developing the strategies and supported in systematically 
        implementing a coherent, integrated plan.

   Broadband adoption will succeed by working in partnership 
        with community-based organizations that are the ``trusted 
        messengers'' and ``honest brokers'' for the unserved and 
        disadvantaged populations.

   Affordable broadband offers are required to increase 
        adoption among low-income households. This is likely to require 
        an Affordable Broadband Lifeline Rate Program given that 
        voluntary efforts to date have had modest market penetration 
        for a variety of reasons, with the most extensive program 
        reaching less than 10 percent of eligible participants.

   Sustainable broadband adoption requires a comprehensive 
        approach that targets and aligns resources in low-income 
        communities with an integrated, comprehensive ``neighborhood 
        transformation'' strategy that incorporates broadband adoption 
        into other services, such as education, workforce preparation, 
        and healthcare.

Recommendations for Continued Federal Government Leadership in 
        Broadband Adoption
    There is a foundation of leadership and expertise in the Federal 
government on which to launch the next generation of work to accelerate 
broadband adoption to close the Digital Divide in America. In 
particular, the powers and resources of the FCC coupled with the 
experience and relationships of NTIA in collaboration with the other 
Federal departments is a solid platform for action. Congress can 
greatly augment this foundation by the following actions:

   Set national goals and performance metrics for broadband 
        deployment and adoption along with a timetable and assigned 
        responsibilities for achieving them to encourage implementation 
        of the National Broadband Plan and utilization of the NTIA Took 
        Kit. Institute regular Congressional oversight proceedings to 
        ensure performance and accountability.

   Integrate broadband and information technologies into all 
        Federal policies and programs through funding incentives to 
        align efforts across departments. There is a need to ``connect 
        the dots'' with a set of coherent strategies that transcend 
        ``bureaucratic silos'' to optimize access to and use of the 
        Internet with high-speed connections. For example:

    --U.S. Department of Health and Human Services (HHS) should build 
            upon the ARRA Health Information Technology for Economic 
            and Clinical Health Act (HITECH) framework to encourage 
            stronger linkages and purposeful collaboration of health 
            exchanges and ``meaningful use'' to the telehealth networks 
            funded by the FCC Rural Health Care Pilots and/or the new 
            Healthcare Connect Fund. HHS and the FCC should make a 
            concerted joint effort to connect all state and local 
            government public health services, federally-qualified 
            health centers (FQHCs), critical care hospitals, tribal 
            healthcare facilities (if desired by Tribal Leaders) to 
            these telehealth-telemedicine networks. This kind of an 
            effort will need to be coordinated with other departments 
            and programs, such as the U.S. Department of Agriculture's 
            Distance Learning, Telemedicine and Broadband Program to 
            ensure rural communities are connected.

    --U.S. Department of Education should aggressively encourage the 
            integration of broadband and computing technologies into 
            the teaching and learning processes in all Federal grants 
            to improve education, particularly to turn around low-
            performing schools because of the ability of the technology 
            to engage and involve low-income parents with an approach 
            similar to School2Home. Implementation nationwide of Common 
            Core Standards will require a major effort on a scale not 
            yet contemplated by educators and policymakers. Promise 
            Neighborhoods grantees should be encouraged to promote 
            ``smart communities'' by incorporating broadband adoption 
            strategies into their programs.

    --U.S. Department of Labor should encourage integration of digital 
            literacy and ICT skills training into all existing 
            workforce preparation programs through Workforce Investment 
            Act allocations to states and all other grants.

    --U.S. Department of Housing and Urban Development should promote 
            ``smart housing'' in all publicly-subsidized multi-unit 
            complexes by allowing the installation of an advanced 
            communications system with broadband connectivity in each 
            residence to be included in construction costs and the 
            maintenance of such a system to be included in operating 
            budgets. Choice Neighborhoods grantees should be encouraged 
            to incorporate broadband adoption strategies into their 
            programs.

    --U.S. Department of Agriculture (Rural Utility Service and all 
            other rural economic development programs) should encourage 
            larger-scale integrated proposals for existing grant funds 
            that combine broadband deployment and adoption. There 
            should be consideration of easements for broadband 
            deployment in National Forests to support public safety, 
            emergency response, and homeland security.

    --U.S. Department of Interior should identify all resources to 
            assist Tribal Leaders (who request such assistance) in 
            providing broadband service to Tribal Lands. There should 
            be consideration of easements for broadband deployment in 
            National Parks to support public safety, emergency 
            response, and homeland security.

    --U.S. Department of Homeland Security should become a proactive 
            partner in FirstNet to accelerate broadband deployment and 
            adoption to support public safety, emergency response, and 
            homeland security.

   Request and support the FCC to accelerate reform the 
        Universal Services Fund (USF) and to incorporate best practices 
        for sustainable broadband adoption. With limited resources, 
        priority consideration for funding and/or subsidies to 
        broadband providers should be given to companies that: (a) have 
        a coherent, explicit program with quantified goals and metrics 
        to increase broadband adoption; (b) partner with CBOs that have 
        a proven track record as the ``trusted messenger and honest 
        broker'' in broadband adoption; and (c) target low-income 
        communities in collaboration with other stakeholders pursuing 
        ``digital inclusion'' and ``neighborhood transformation'' 
        strategies (such as digital literacy in schools, workforce 
        training, or publicly-subsidized housing).

    --An Affordable Broadband Lifeline Rate Program should be 
            established within the next year and made available to 
            residents in low-income census tracts in which there is a 
            coherent ``digital inclusion'' component of a 
            ``neighborhood transformation'' initiative with responsible 
            local governments, key stakeholders, and respected CBOs.

    --Renewal and reform of eRate should prioritize low-performing 
            schools and libraries in low-income neighborhoods that have 
            established a coherent program with quantified goals and 
            accountability to increase broadband adoption, especially 
            as part of an overall ``neighborhood transformation'' 
            initiative.

    --Connect America Fund and other programs to subsidize broadband 
            infrastructure should give priority funding to deployment 
            projects with plans and partners to promote broadband 
            adoption.

   Provide additional funding to NTIA as a prudent investment 
        in global competitiveness to establish the ``next generation'' 
        broadband adoption program that builds upon the ARRA BTOP 
        experience, aligns with other existing efforts, and leverages 
        Federal resources through partnerships to achieve explicit 
        adoption goals and outcomes by 2020.

    --Encourage states to adopt broadband adoption strategies and plans 
            by giving priority consideration for funding to projects 
            that align with and complement state programs that have 
            explicit adoption goals with accountability for 
            performance.

    --Facilitate collaboration among successful BTOP grantees to join 
            forces with state governments to develop broadband adoption 
            strategies and plans.

    --Request assistance from the National Association of Regulatory 
            Utility Commissioners (NARUC) to engage states and convene 
            information forums on development of broadband adoption 
            strategies and plans.

   Foster public-private partnerships to accelerate broadband 
        deployment and adoption. There is no substitute for the 
        innovation and efficiency of the private sector when engaged as 
        sincere partners motivated to achieve explicit goals. Public-
        private partnerships can significantly leverage public 
        resources for a higher return on investment to taxpayers and 
        ratepayers.

    --Request the FCC and NTIA to engage broadband providers in helping 
            design the ``next generation'' broadband adoption program 
            to achieve explicit goals and outcomes.

    --Encourage providers to partner with EveryoneOn (formerly Connect-
            to-Compete) by setting adoption targets coupled with 
            affordable broadband offers that can be made available 
            without undermining profitability. There needs to be market 
            competition for low-income consumers to become sustainable 
            broadband customers.

    --Request the FCC to structure USF reforms for a Broadband Lifeline 
            Rate Program and eRate to encourage and reward providers 
            who partner with non-profit intermediaries (such as 
            EveryoneOn) and trusted CBOs with a proven track record and 
            align with state plans. Reimbursement and subsidies from 
            the USF should reward public-private partnerships that 
            drive to and achieve explicit broadband adoption goals.
_______________________________________________________________________

    [The witness also submitted U.S. Department of Commerce National 
Telecommunications and Information Administration and California 
Emerging Technology Fund, Lessons Learned from the Field: Connecting 
Californians to Broadband and Digital Care (http://www.cetfund.org/
files/1301_Field-Lessons-Learned%20-Connecting_Californians.pdf)]



                                 ______
                                 
                                 
                                 
                                 
                                 
                                 ______
                                 
                                 
                                 
                                 
                                 
                                 ______
                                 
                                 
                                 
                                 
                                 
                                 ______
                                 
                                 
                                 
                                 
                                 
                                 ______
                                 
                                 
                                 
                                 
                                 
                                 ______
                                 
                                 
                                 

    Senator Pryor. Thank you.
    Mr. Cohen.

STATEMENT OF DAVID L. COHEN, EXECUTIVE VICE PRESIDENT, COMCAST 
                          CORPORATION

    Mr. Cohen. Thank you, Mr. Chairman, Ranking Member Wicker, 
who does represent our birth state in 1963. And Senator Wicker, 
you'll be pleased to know that we'll be celebrating that 50th 
birthday on November 20, so just about 3 weeks from now. And 
also, all members of the Subcommittee, thank you for the 
opportunity to testify today.
    The Internet has the potential to fundamentally transform 
our society and our economy, to equalize access to education, 
healthcare, vocational opportunities, and even to news, 
information, and entertainment. But for this to happen, we need 
to have ubiquitous broadband deployment and full broadband 
adoption.
    Broadband deployment in the United States has been a great 
success story. Critics who bemoan America's allegedly second-
rate broadband infrastructure are simply mistaken. To 
paraphrase the late Senator Moynihan, they are entitled to 
their own opinions, but not their own facts. The reality is 
that America's broadband companies have invested more than $1.2 
trillion to deploy world-class broadband networks which now 
reach 98 percent of Americans. Three of the ten companies that 
invested the most inside the U.S. last year are broadband 
infrastructure companies: Comcast, Verizon, and AT&T. For our 
part, Comcast has built out its broadband plant to over 99.5 
percent of the homes in our footprint. We have increased 
network speeds 12 times over the past 11 years, and, earlier 
this year, we demonstrated that our existing network, right 
here in Washington, can deliver speeds up to 3 gig down.
    Concededly, the broadband deployment picture is not 
perfect. There are still unserved rural areas in our nation, 
and we need to encourage innovative solutions to fill those 
gaps. But, the larger problem affecting many more Americans is 
the lack of broadband adoption in areas where broadband is 
available. Research by the FCC, Pew, and others, has 
demonstrated that a bucket of digital literacy issues--lack of 
understanding of relevance or value, fear of the Internet, and 
lack of understanding how to access and use the Internet--are 
the main barriers to adoption. The National Broadband Plan 
found that 41 percent of non-adopters cited these as the main 
barriers. It also found that only 15 percent of non-adopters 
cited the monthly ISP price as the main obstacle. These trends 
were confirmed by Pew's most recent survey, which Aaron 
summarized, which found that only 9 percent of people who don't 
go online at home cited the price of connection as the main 
barrier to adoption.
    Addressing the broadband adoption gap is a personal 
priority for me and for Comcast. That is why Comcast created 
the program we now call ``Internet Essentials.'' This was a 
voluntary commitment we offered during the regulatory review of 
Comcast's acquisition of NBCUniversal. But, Comcast has 
expanded and strengthened Internet Essentials since its launch 
so many times and in so many different ways that the program 
today barely resembles what is required under the FCC's order. 
In addition to providing low-cost broadband service, Internet 
Essentials delivers access to low-cost computers and to digital 
literacy training; thus, hitting the touch point of every 
barrier to adoption that you've heard about on this panel 
today.
    And I'm pleased to make an announcement today. And that is 
that Comcast recently connected our one millionth Internet 
Essentials user. In just over 2 years of the program's 
existence, we have connected more than 250,000 families to the 
Internet, most for the very first time. Now a million is a very 
big number, more than the entire population of the City of San 
Francisco and about the size of the entire state populations of 
states like Delaware or Montana.
    We measure our success, though, not just by how many people 
are connected to broadband at home, but also by how they are 
using it. And what they have told us as we survey them is 
incredibly encouraging. Ninety-eight percent of those Internet 
Essentials customers surveyed say their kids use the Internet 
for doing homework, and 94 percent of them feel that Internet 
access has had a positive impact on their child's grades; 59 
percent say that the Internet has helped someone in their 
household find a job. So, yes, broadband adoption through a 
program like Internet Essentials really does work.
    I'd also like to say that Comcast supports an improved role 
for broadband in education. Every student deserves access to an 
integrated, always-on digital learning platform, a continuum of 
connectivity that begins in the classroom, follows the child to 
after-school programs, and ends with broadband connectivity at 
home. Updates to the E-Rate program and the administration's 
ConnectED initiative will advance these goals and can be done 
in a cost-effective and efficient manner. I commend Chairman 
Rockefeller, members of this subcommittee, and the 
administration for their leadership in these areas.
    When we look at broadband in America, there is much to be 
proud of, but there is much work that still needs to be done, 
particularly with adoption. Comcast is committing to doing its 
part and to working with you on these issues.
    So, thank you for this opportunity, and I look forward to 
your questions.
    [The prepared statement of Mr. Cohen follows:]

    Prepared Statement of David L. Cohen, Executive Vice President, 
                          Comcast Corporation

    Mr. Chairman, Ranking Member Wicker, and Members of the 
Subcommittee:

    Thank you for inviting me to testify today. I welcome the 
opportunity to discuss the critical importance of expanding the 
adoption of broadband Internet service throughout our great nation. The 
Internet is an incredible technology that is unparalleled in its 
ability to level the playing field and equalize access to education, 
health care, and vocational opportunities, as well as news, 
information, and entertainment. People who are not on the Internet, 
however, are shut out from these benefits. Comcast, together with 
thousands of community partners, has made extraordinary efforts to 
address this challenge, but much work remains to be done.
    At the outset, let me commend the Subcommittee for focusing on the 
issue of broadband adoption. Since 1996, America's broadband providers 
have invested over a trillion dollars to deploy world-class broadband 
networks throughout the United States. Thanks to these investments, the 
Internet has become a platform for innovation unlike any the world has 
ever seen. Entire industries that would otherwise have been impossible 
have flourished, and American companies like Google, Netflix, Facebook, 
Amazon and so many others continue to thrive at home and around the 
globe because broadband providers like Comcast have invested to bring 
the Internet to nearly every American household. While there are still 
areas of the United States--particularly remote, rural areas--that 
remain unserved, the United States' broadband deployment story is a 
story of success.
    But there is a cruel irony at play. Because of the digital divide, 
the Internet actually exacerbates, rather than narrows, the differences 
in opportunities available to those who access the Internet versus 
those who do not. This hearing can help shine a light on this issue of 
fundamental fairness.
    The issue of broadband adoption has been a priority for me and for 
Comcast. We care deeply about this issue. Rigorous survey results, 
including by the FCC (as part of the National Broadband Plan), the Pew 
Research Center, and others, consistently show that the main reasons 
why Americans do not adopt broadband are the perceived lack of 
relevance--the absence of understanding the value of the Internet--and 
the lack of digital literacy. In other words, the people who do not 
subscribe to broadband Internet services often do not see the benefits 
of broadband and do not have the skills or tools to use broadband. The 
cost of computer equipment and the monthly cost of a broadband 
connection are also factors, but when Americans who have not adopted 
broadband are asked to cite the main reason they have not done so, they 
consistently cite these factors less frequently than they cite 
relevance and digital literacy.
    My colleagues and I at Comcast viewed these facts as a challenge 
and an opportunity to develop a program that could begin to address 
these obstacles of digital literacy, relevance, and cost in areas that 
Comcast serves. Working in concert with community partners and local 
elected officials, we developed the Internet Essentials program to 
address the main reasons that Americans do not adopt broadband.
    As I detail later on, we are very proud of our results so far. In 
its first 22 months, Internet Essentials has connected over 220,000 
households--that's over 900,000 low-income Americans--to the Internet, 
most for the first time. That's about 40 percent more people than the 
entire population of Washington, D.C., and about equivalent to the 
entire population of the City of San Francisco. While we are pleased 
with these results, we know that our work is not done. We continue to 
improve and expand the program, and have redoubled our efforts to 
target the barriers to adoption and to bring even more non-adopters 
online.
    The barriers to universal broadband adoption in the United States 
are complex and deep-rooted, and often connected to the deep 
socioeconomic and poverty-driven problems that impact other areas like 
education and health. Overcoming these obstacles will require 
commitment and persistence from all stakeholders. Comcast is ready and 
willing to do our part, and we look forward to working with others who 
share these goals.

I. Broadband Deployment Has Been A Remarkable Success in the United 
        States
    One part of bringing the promise of broadband to all Americans is 
deploying broadband infrastructure throughout the Nation. Some critics 
still insist on belittling broadband in America by citing selective 
statistics to support the unfounded charge that our broadband Internet 
service is second-rate. To paraphrase the late Senator Moynihan, they 
are entitled to their own opinions, but not their own facts.
    The facts are that Americans are getting world-class broadband from 
competing companies, and it is getting better every day. Today, more 
than 94 percent of Americans have access to one or more wired broadband 
Internet services,\1\ and over 85 percent of Americans have access to 
networks capable of delivering speeds of 100 Mbps and higher.\2\ More 
than 300 million Americans have access to 4G LTE mobile broadband, 
offering speeds up to 20 Mbps.\3\ Consumers in the United States have 
the third-lowest entry-level broadband prices in the world and the 
third-lowest price per GB of data.\4\
---------------------------------------------------------------------------
    \1\ See Eighth Broadband Progress Report, 27 FCC Rcd 10342  60 
(2013) at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-12-
90A1.doc (``Eighth Broadband Progress Report'') (indicating that 
``overall, more than 94 percent of Americans have access to fixed 
broadband''); National Broadband Map, Broadband Statistics Report, 
Access to Broadband Technology by Speed, at 3 http://
www.broadbandmap.gov/download/Technology%20by%20Speed
.pdf (``National Broadband Map Report'') (indicating that 93.92 percent 
of Americans have access to wireline broadband speeds in excess of 3 
Mbps downstream and 768 kbps upstream) (last visited Oct. 25, 2013). 
When wireless broadband service is included, 98.75 percent of Americans 
have access to broadband speeds in excess of 3 Mbps downstream and 768 
kbps upstream. See National Broadband Map Report at 3.
    \2\ See NCTA, Industry Data, http://www.ncta.com/industry-data 
(indicating that DOCSIS 3.0-enabled networks, which are capable of 
delivering speeds of 100 Mbps and higher, pass 85 percent of American 
households) (last visited Oct. 25, 2013).
    \3\ Verizon, News Center, LTE Information Center, http://
www.verizonwireless.com/news/LTE/Overview.html (last visited Oct. 25, 
2013).
    \4\ See Int'l Telecomm. Union, Measuring the Information Society 
2012, at 88, available at http://www.itu.int/ITU-D/ict/publications/
idi/material/2012/MIS2012_without_Annex_4
.pdf (last visited Oct. 25, 2013); International Broadband Data Report, 
27 FCC Rcd 9884  33 (2012) (``The United States is ranked third out of 
16 countries with an average price of $0.76/GB.'').
---------------------------------------------------------------------------
    These data are particularly remarkable given some of the geographic 
and topographical challenges we face in the United States that make 
broadband deployment more challenging here than elsewhere. We rank 28 
out of 34 OECD countries on ``urbanicity,'' which is a measure of 
concentration in high density urban areas.\5\ Because of these 
differences, it may be more appropriate to compare the broadband 
situation in individual states to that in other countries. For example, 
current speed data from Akamai shows that, if U.S. states were ranked 
against countries worldwide, six of the top ten areas in the world with 
respect to average connection speed would be U.S. states.\6\
---------------------------------------------------------------------------
    \5\ Richard Bennett et al., ITIF, The Whole Picture: Where 
America's Broadband Networks Really Stand, at 60 (Feb. 2013), available 
at http://www2.itif.org/2013-whole-picture-america-broadband-
networks.pdf (``The Whole Picture''). By way of comparison, the United 
States' urbanicity score was 5.2, as compared with South Korea, which 
has an urbanicity score of 67.1. Id.
    \6\ See Akamai, The State of the Internet, at Khttp://
www.akamai.com/dl/documents/akamai_soti_q213.pdf?WT.mc_id=soti_Q213 
(last visited Oct. 25, 2013).
---------------------------------------------------------------------------
    Moreover, America's policy of fostering robust broadband 
competition by encouraging the build-out of competing networks has 
worked. The United States ranks third in the OECD in the percentage of 
households with access to two or more competitive wired broadband 
providers.\7\ And new entrants like Google Fiber, Gigabit Squared, and 
DISH Network, as well as new innovative technologies like VDSL2 
vectoring, promise to make the broadband marketplace even more dynamic. 
That's investment, innovation, and competition at work.
---------------------------------------------------------------------------
    \7\ The Whole Picture at 17.
---------------------------------------------------------------------------
    In less than two decades, the American broadband industry has 
invested over $1.2 trillion to bring multiple forms of broadband 
infrastructure to nearly every corner of the country.\8\ Even during 
this country's recent economic troubles, when job growth stalled and 
private investment tumbled, American broadband companies poured some 
$250 billion in private investment into broadband.\9\ So it is no 
surprise that when the Progressive Policy Institute (``PPI'') issued a 
list of their ``Investment Heroes''--companies that have invested the 
most money here in the United States--three of the ten largest domestic 
investors that were not financial companies were broadband 
infrastructure companies: Comcast, Verizon, and AT&T.\10\ According to 
PPI, ``telecommunications and cable companies are a major driver of 
U.S. investment today.'' \11\ Of course, this substantial investment 
translates not only into better and more widespread broadband networks, 
but also innovation, economic growth, and jobs.
---------------------------------------------------------------------------
    \8\ USTelecom, Broadband Industry Stats, Broadband Investment, at 
http://www.ustelecom
.org/broadband-industry/broadband-industry-stats/investment (last 
visited Oct. 25, 2013).
    \9\ Broadband for America, Blog, ``Broadband Investment from Trade 
Groups Tops $250 Billion,'' http://www.broadbandforamerica.com/blog/
broadband-investment-trade-groups-tops-250-billion (May 19, 2011).
    \10\ Diana G. Carew & Michael Mandel, Progressive Policy Institute, 
U.S. Investment Heroes of 2013: The Companies Betting on America's 
Future, at 5 (Sept. 2013), available at http://www
.progressivepolicy.org/wp-content/uploads/2013/09/2013.09-Carew-
Mandel_US-Investment-Heroes-of-2013.pdf.
    \11\ Id. at 2.
---------------------------------------------------------------------------
    For our part, Comcast made all these massive investments with 
private, at-risk capital--we received no government subsidies or 
guaranteed loans. As a result, today Comcast's facilities deliver 
world-class cable, voice, and broadband Internet services. We have made 
broadband Internet available to over 99.5 percent of the homes within 
our ``footprint,'' and our fiber backbone stretches across 141,000 
fiber route miles--that's enough to wrap around the Earth more than 
five times. We have increased the speeds available over that network 12 
times over the past 11 years, and we will continue to do so because our 
network is capable of evolving to meet all types of demand. This year, 
we demonstrated that our network is capable of delivering 3 Gbps.\12\ 
And just last week, we successfully trialed the first 1 Terabit 
connection on a portion of our network from Ashburn, Va. to Charlotte, 
NC.\13\ This is believed to be the first trial in which live data 
traffic was carried at this speed on an existing, commercial 
network.\14\ All this is possible because of the investment that I 
mentioned earlier. We do not sit still; the marketplace simply will not 
allow it.
---------------------------------------------------------------------------
    \12\ See News Release, Comcast Corp., ``The Future of Broadband 
Speed and 4K Ultra HD Video'' (June 11, 2013), at http://
corporate.comcast.com/news-information/news-feed/comcast-demonstrates-
the-future-of-broadband-speed-and-4k-ultra-hd-video.
    \13\ See News Release, Ciena Corp., ``Comcast Conducts Industry's 
First Live 1Terabit Network Trial with Ciena's 6500 Converged Packet 
Optical Solution'' (Oct. 22, 2013), at http://www
.ciena.com/about/newsroom/press-releases/Comcast-Conducts-Industrys-
First-Live-1Terabit-Net
work-Trial-with-Cienas-6500-Converged-Packet-Optical-Solution.html.
    \14\ Id.
---------------------------------------------------------------------------
    I certainly would not claim the deployment picture is perfect. 
While nearly all Americans have access to satellite broadband,\15\ 
which provisions speeds as fast as 25 Mbps,\16\ more wireline and 
wireless broadband deployment is needed in remote parts of rural 
America.\17\ We should not downplay the geographical and logistical 
challenges of addressing this problem, and we need to be more focused 
on facilitating creative technology solutions.\18\ But, on the whole, 
the speeds and range of choices available to the vast majority of 
Americans are light-years beyond what anybody reasonably would have 
anticipated just 10 or 15 years ago. This is great news for our 
country.
---------------------------------------------------------------------------
    \15\ Connecting America: The National Broadband Plan, FCC, at 137 
(rel. March 16, 2010), http://download.broadband.gov/plan/national-
broadband-plan.pdf (``National Broadband Plan'').
    \16\ See Exede Internet, Internet Packages, at http://
www.exede.com/internet-packages-pricing/service-availability (last 
visited Oct. 25, 2013).
    \17\ See Section 706 Fixed Broadband Deployment Map/FCC.gov, at 
http://www.fcc.gov/maps/section-706-fixed-broadband-deployment-map 
(last visited Oct. 25, 2013).
    \18\ There are promising proposals and initiatives underway in this 
regard. See, e.g., Ben Leubsdorf, ``UNH to test `Super Wi-Fi' 
technology that could expand broadband access in rural areas,'' Concord 
Monitor, Sept. 24, 2013, available at http://www.concordmonitor.com/
news/politics/8640947-95/unh-to-test-super-wi-fi-technology-that-could-
expand-broadband-access-in-rural-areas; Richard Bennett, ``Public-
Private Partnerships will Close Rural Broadband Gap,'' Billings 
Gazette, Aug. 7, 2013, available at http://billingsgazette.com/news/
opinion/guest/guest-opinion-public-private-partnerships-will-close-
rural-broadband-gap/article_0add8e93-4478
-5ec7-897e-aff16bc406a2.html.
---------------------------------------------------------------------------
II. Broadband Adoption Has Skyrocketed, But Many Americans Are Still on 
        the Wrong Side of the ``Digital Divide''
    The key to empowering Americans through access to the Internet is 
to persuade them that adopting broadband is worth their time, effort, 
and money. We have come a long way in the last 20 years. In 1996, just 
a small percentage of Americans accessed the Internet from their 
homes,\19\ and the vast majority of those who did used dial-up 
connections. Thankfully, we have moved beyond the slow speeds available 
over dial-up and have widely adopted broadband. Today, according to 
surveys conducted by NTIA and the Pew Research Center, about 70 percent 
of Americans subscribe to wired broadband.\20\ Millions more have 
tablets and smartphones that use mobile wireless connectivity to access 
a wide range of Internet services for work and pleasure.\21\
---------------------------------------------------------------------------
    \19\ See Pew Internet--Trend Data (Adults), Internet Adoption, 
1995-2013, at http://www.pewinternet.org/Trend-Data-(Adults)/Internet-
Adoption.aspx (last visited Oct. 25, 2013).
    \20\ See Pew Research Center, Home Broadband 2013 (Aug. 26, 2013), 
available at http://pewinternet.org//media//Files/Reports/2013/
PIP_Broadband%202013_082613.pdf (``Pew Home Broadband 2013''); Nat'l 
Telecomm. & Info. Admin., ``Exploring the Digital Nation: America's 
Emerging Online Experience,'' (June 7, 2013) at http://
www.ntia.doc.gov/files/ntia/publications/exploring_the_digital_nation_-
_americas_emerging_online_experience.pdf (``Approximately 69 percent of 
households used broadband Internet at home (72 percent if including 
dial-up) in July 2011.''). Pew's data show that, except for just one 
year between 2010 and 2011 when we think general economic factors 
played a role, broadband adoption has increased every year by an 
average of over five percentage points.
    \21\ See Pew Research Center, Tablet and E-Reader Ownership Update, 
at http://pewinternet.org/Reports/2013/Tablets-and-ereaders.aspx (Oct. 
18, 2013) (``The number of Americans ages 16 and older who own tablet 
computers has grown to 35 percent.''); Pew Research Center, Smartphone 
Ownership--2013 Update, at 2 (June 5, 2013) available at http://
pewinternet.org//media//Files/Reports/2013/
PIP_Smartphone_adoption_2013_PDF.pdf (``56 percent of American adults 
are now smartphone owners'').
---------------------------------------------------------------------------
    But there is much more work to be done. Too many Americans do not 
yet enjoy the benefits of broadband Internet access. A broadband 
adoption rate of around 70 percent means that there are still about 30 
percent of Americans who do not subscribe to a fixed broadband Internet 
connection at home (and only about one-third of this group has Internet 
access via a smartphone).\22\ More troubling still, clear divisions 
have emerged between the broadband ``haves'' and ``have-nots.'' Starkly 
different broadband adoption rates are evident across educational, 
racial, ethnic, socioeconomic, and geographic lines. For example, the 
Pew Research Center tells us that 74 percent of White Americans have 
high-speed broadband connections at home, but only 64 percent of 
African Americans and 53 percent of Hispanic Americans have high-speed 
broadband.\23\ In addition, one of the most important determinants of 
low adoption is education--only 37 percent of Americans without a high 
school diploma have adopted broadband, while college graduates have an 
89 percent adoption rate.\24\ So, nearly two decades after then-
Representative Ed Markey warned about the ``digital divide,'' we still 
have one.
---------------------------------------------------------------------------
    \22\ Pew Home Broadband 2013 at 4.
    \23\ Id. at 3.
    \24\ Id.
---------------------------------------------------------------------------
    Doing something about the persistent adoption gap requires 
understanding the root causes. Rigorous survey-based analysis over the 
past several years has established that the main reasons why a large 
portion of Americans do not adopt broadband are a lack of digital 
literacy, a lack of understanding of the value of the Internet, and a 
belief that the Internet is not relevant to their lives. The National 
Broadband Plan found that nearly half--41 percent--of broadband non-
adopters cited either a lack of digital literacy or a lack of perceived 
relevance as the main reason for non-adoption.\25\ Only 15 percent of 
respondents cited the cost of a monthly broadband subscription as the 
most important reason for not adopting broadband, with another 10 
percent pointing to the cost of a computer. In its latest survey, Pew 
reported similar results, finding that only 9 percent of Americans who 
do not go online at home cited the expense of the Internet connection 
as the reason for not doing so.\26\
---------------------------------------------------------------------------
    \25\ John B. Horrigan, OBI Working Paper Series No. 1, Broadband 
Adoption and Use in America, at 5 (rel. Feb. 2010), available at http:/
/hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-296442A1.pdf.
    \26\ See Pew Research Center, Who's Not Online and Why, at 12 
(Sept. 25, 2013), available at http://pewinternet.org//media//Files/
Reports/2013/PIP_Offline percent20adults_092513.pdf. Although that Pew 
study looked at Internet use, which is slightly different from at home 
adoption, it does show that affordability is not the main driver.
---------------------------------------------------------------------------
    So, we know what the problems are. Now we--private sector and 
public sector alike--need to muster our collective resources to address 
them.

III. Comcast Developed the Internet Essentials Program to Address and 
        Overcome Many of the Key Obstacles to Broadband Adoption
    Comcast has long been committed to addressing the challenges to 
broadband adoption. One of the earliest cable industry efforts was a 
program known as Cable in the Classroom, which brought the first 
Internet connections to many American schools for free, and promoted 
the responsible and effective use of cable's broadband technology, 
services, and content in teaching and learning. The cable industry has 
connected thousands of schools and libraries to the Internet under this 
program.
    Since 2009, we have supported the Comcast Digital Connectors 
program, which gives young people, primarily from diverse, low-income 
backgrounds, the opportunity to develop their skills in using 
computers, applications, and the Internet. Almost 2,000 youth have 
graduated from this program, contributing 100,000-plus hours of service 
in their communities. We also support the Boys & Girls Clubs of 
America's ``Club Tech'' program, which provides young people with 
access to technology, software, curriculum, and training, helping to 
better prepare them for success both in their educational endeavors and 
work careers. We support Club Tech at more than 2,000 club locations 
across the country, serving about 500,000 students each year.
    In 2011, we took our efforts to the next level. As part of our 
acquisition of NBCUniversal, we offered up a voluntary commitment to 
launch a low income broadband adoption program, and that commitment was 
adopted in the FCC Order approving the NBCUniversal transaction. That 
commitment has grown into Internet Essentials, which is the Nation's 
largest and most comprehensive broadband adoption program and is 
specifically designed to systematically address the primary barriers to 
broadband adoption that have been identified in the National Broadband 
Plan and subsequent survey results.
    Since its launch almost 24 months ago, Internet Essentials has made 
broadband Internet accessible to millions of low-income families across 
the Comcast footprint for $9.95 per month--with no charge for the cable 
modem, no installation charge, no contract required, and no obligation 
to buy any other Comcast service. In addition to affordable broadband, 
Internet Essentials gives eligible families the opportunity to purchase 
an Internet-ready computer for under $150, heavily subsidized by 
Comcast. The program also includes a comprehensive digital literacy 
training component--in print, online, and in person--designed to 
empower students and their parents to unlock the full potential of the 
Internet.
    We have been relentless in getting the word out about the program. 
We have distributed 27 million brochures, in 14 different languages, to 
school districts and community partners. We have fielded 1.5 million 
phone calls in our Internet Essentials call center, and we have had 1.2 
million visits to the Internet Essentials websites in English and 
Spanish. We also have broadcast nearly two million public service 
announcements with the help of well-known and respected public figures 
like Super Bowl-winning coach Tony Dungy, and numerous governors, 
mayors, school superintendents, and community leaders from across the 
country who are committed to ensuring that all of their students have 
the opportunity to connect to the Internet at home.
    Comcast's extensive partnership with a diverse array of leaders 
from the education, government, and non-profit sectors across the 
Comcast service area continues to be a cornerstone of the Internet 
Essentials program's success. Over the past three years, we have worked 
hard to engage school administrators, teachers, and parents in the more 
than 30,000 schools in more than 4,000 school districts across the 
Comcast footprint to promote Internet Essentials to eligible families, 
including distributing brochures with their National School Lunch 
Program (``NSLP'') letters and report cards, providing presentations to 
school stakeholders, and attending numerous back-to-school nights and 
parent-teacher association meetings.
    Comcast also has worked with thousands of community-based 
organizations, faith-based organizations, libraries, and educational 
associations, such as the National Urban League, the League of United 
Latin American Citizens, and the National Council of La Raza, to spread 
the word about Internet Essentials, to create and foster an atmosphere 
of support and excitement about Internet Essentials, and to share 
``best practices'' with each other to improve both the program and our 
communications. Finally, state, local, and Federal officials, including 
members of this Subcommittee, serve an important role in educating 
their constituents about the importance of broadband and helping them 
to find programs like Internet Essentials.
    We are proud of the results. As I mentioned earlier, in the first 
22 months of the program, we connected more than 220,000 families, 
totaling more than 900,000 low income Americans, to the power of the 
Internet at home--many for the first time. We have sold 18,000 
subsidized computers at an affordable price point. And 20,000 people 
have attended free, in-person digital literacy training.
    We are also tremendously encouraged by data we have compiled based 
on surveys of the families who have signed up for the program. In 
particular:

   90 percent of Internet Essentials customers surveyed are 
        ``highly satisfied'' with the service, and 98 percent of those 
        surveyed would recommend Internet Essentials to others.

   85 percent of respondents said they use Internet Essentials 
        to go online on a daily basis.

   More importantly, 98 percent of survey participants reported 
        that their school-age children used the Internet Essentials 
        service for school assignments, and of that group, 94 percent 
        felt Internet Essentials had a positive impact on their child's 
        grades.

   Other popular uses included general research (94 percent), 
        e-mail (85 percent), social networking (73 percent), health 
        care and government services (66 percent), online bill payment 
        (60 percent), and employment searches (58 percent). The 
        majority of those who said they used Internet Essentials for 
        employment searches felt that the program helped someone in the 
        household locate or obtain a job.

    We have learned a lot over the first two years of the program, and 
we have made improvements based on our direct interactions with 
families. In fact, at this point, the program has gone far beyond the 
original commitment we made in connection with the NBCUniversal 
transaction. For example, we initially designed the program only for 
families that have at least one child eligible for a free school lunch 
through the NSLP. Last year, we extended eligibility to families 
eligible to receive NSLP reduced-price school lunches, making 300,000 
additional families eligible for the program. This year, we expanded 
eligibility yet again, to include families with private, parochial, and 
home-schooled students who otherwise meet the NSLP eligibility 
criteria. This enhancement made nearly 200,000 additional families 
eligible for Internet Essentials in Comcast's service areas--bringing 
the total to nearly 2.6 million eligible families.
    We also improved the service we are offering as part of the 
program. When we launched the program we offered a 1.5 Mbps downstream 
connection, but last year we raised that to 3 Mbps, and this year we 
raised it again, to 5 Mbps, all without raising the price.
    And we continue to find ways to make the process easier and faster 
for qualified families to enroll. For example, we recently expanded the 
instant approval process for families whose students attend schools 
where 70 percent or more of the students are eligible to participate in 
the National School Lunch Program.\27\ We also have set up an online 
application request form, which is available in both English and 
Spanish and can be accessed through any Internet-connected computer (at 
recreation centers, libraries, and public computing labs, for example), 
or on tablets or smartphones. In addition, we have implemented 
innovative measures such as Internet Essentials Opportunity Cards, so 
Comcast's non-profit partners and others can purchase up to a year of 
Internet Essentials service for qualified families. We are confident 
that these changes will make Internet Essentials even more attractive 
to families, allowing us to bring the benefits of the Internet to even 
more people--and, importantly, more children.
---------------------------------------------------------------------------
    \27\ Previously, only families whose students attended schools 
where 80 percent or more of the students are eligible to participate in 
the National School Lunch Program could take advantage of the instant 
approval process.
---------------------------------------------------------------------------
IV. A Comprehensive Solution to the Adoption Problem Must Involve 
        Efforts from All Stakeholders
    We designed Internet Essentials to address the key barriers to 
adoption. It has been a remarkable success, but our on-the-ground 
experience has shown that improving broadband adoption in these 
communities is more complicated than just addressing relevance, digital 
literacy, and price. We have found that solutions must address the 
impact of poverty, education, and a range of other deep socioeconomic 
problems that are at the heart of the non-adoption issue. This is why 
we believe that all stakeholders in this area must work together to 
more effectively bridge the digital divide. The fact remains that no 
one company and no single program will completely close the digital 
divide in America. The challenges are certainly daunting, but progress 
is being made, and will continue to be made if we all make this a 
priority.
    The education space is one area where several key broadband 
adoption initiatives deserve our attention and support. Internet 
Essentials is targeted to homes with school-aged children purposefully. 
As a nation, we must recognize the importance of an educated and 
technologically literate work-force ready to compete in the economy of 
the 21st century. In many homes, it is often children who first develop 
digital skills and understand the relevance of broadband to their lives 
and education. Once children gain these skills, they are able to 
demonstrate the benefits of broadband adoption to others in their 
households and communities. All of this helps increase digital literacy 
and reduce the apprehension about technology and broadband for both 
children and adults.
    Broadband at school complements broadband at home. We must all work 
together to ensure America's classrooms have access to the advanced 
broadband networks that will support a modern digital learning 
environment.\28\ To that end, we share the ConnectED vision that ``our 
schools [must be] an integral part of the broadband and technology 
transformation'' to ensure that students ``can benefit from these 
advances in teaching and learning.'' \29\ And I would be remiss not to 
highlight this Committee's vision and role in identifying the critical 
need to connect schools almost twenty years ago. Chairman Rockefeller 
and former Senators Olympia Snowe, Jim Exon, and Bob Kerrey all deserve 
enormous credit for the E-rate program, as does the Senator from 
Massachusetts, Mr. Markey, who championed this cause while in the House 
of Representatives.
---------------------------------------------------------------------------
    \28\ ConnectED: President Obama's Plan for Connecting All Schools 
to the Digital Age, The White House, at 2, (June 6, 2013) at Khttp://
www.whitehouse.gov/sites/default/files/docs/connected_fact_sheet.pdf 
(``Our schools were designed for a different era. . . . This system 
does not take into account the constant learning opportunities of 
global connectivity[.]'').
    \29\ Id. at 1-2.
---------------------------------------------------------------------------
    Over the past two decades, the E-rate program has succeeded in 
ensuring that many elementary and secondary schools have access to 
basic Internet connectivity at discounted rates.\30\ However, as 
Senator Rockefeller noted earlier this year, ``basic Internet 
connectivity is no longer sufficient.'' \31\ Today's educational 
environment requires not only the delivery of broadband Internet 
service to schools, but also the deployment of the infrastructure 
within the school, such as through robust Wi-Fi networks, in order to 
meet the digital needs of each classroom.\32\ A modernized E-rate 
program can help achieve these goals in a cost-effective and efficient 
manner.
---------------------------------------------------------------------------
    \30\ See, e.g., News Release, FCC, FCC Launches Modernization of E-
Rate Program to Deliver Students & Teachers Access to High-Capacity 
Broadband Nationwide, at 1 (July 19, 2013), available at http://
transition.fcc.gov/Daily_Releases/Daily_Business/2013/db0719/DOC-322284
A1.pdf (``Over the past 15 years, support provided by the E-rate 
program has helped revolutionize schools' and libraries' access to 
modern communications networks, but the needs of schools and libraries 
are changing.'').
    \31\ See Press Release, U.S. Senate Committee on Commerce, Science, 
and Transportation, Rockefeller Says E-Rate Should Expand to Connect 
More Students to High Speed Broadband (June 6, 2013), available at 
http://www.commerce.senate.gov/public/index.cfm?p=PressRel
eases&ContentRecord_id=5cb24ad3-281e-4abd-acd0-
afb699008e3e&ContentType_id=77eb43da-a
a94-497d-a73f-5c951ff72372&Group_id=4b968841-f3e8-49da-a529-
7b18e32fd69d&YearDisplay
=2013. See also, Modernizing the E-Rate Program for Schools and 
Libraries, 28 FCC Rcd. 11304 (2013) (Statement of Commissioner Jessica 
Rosenworcel) (``[W]e are quickly moving from a world where what matters 
is connectivity to a world where what matters is capacity.'').
    \32\ See Comments of Comcast Corporation, WC Docket No. 13-184, at 
9-10 (Sept. 16, 2013). As Comcast has explained, more spectrum needs to 
be provided for unlicensed use ``[i]n order to ensure that students get 
the full capabilities of the underlying wired broadband connection the 
Commission intends to support.'' Id. at 20.
---------------------------------------------------------------------------
    In 1996, we could talk about connected learning in terms of the 
school. When it comes to learning in the digital age, however, we need 
an integrated, always-on digital learning platform that delivers 
improved educational outcomes for every student--a continuum of 
connectivity. It begins in the classroom and throughout the school with 
access to an array of digital learning tools, but then follows the 
child to after-school programs at public libraries, recreation centers, 
and other community centers, and ends with at-home broadband. If we 
want our children to succeed in this complex and connected world, it 
really will take a coordinated effort to create these types of 
continuous digital communities.\33\
---------------------------------------------------------------------------
    \33\ To foster the development of these types of digital 
communities, earlier this year Comcast and the City of Chicago 
announced the development of Internet Essentials Learning Zones, a 
concept that Comcast is now implementing in other Internet Essentials 
communities. See News Release, Comcast Corp., ``Mayor Emanuel, Comcast 
Announce that Chicago's Internet Essentials Enrollment Doubles to 
14,000, More Than Any Other City in the Nation'' (Sept. 16, 2013), 
available at http://www.businesswire.com/news/home/20130916006076/en/
Mayor-Emanuel-Com
cast-Announce-Chicago%E2%80%99s-Internet-Essentials (``The zones will 
help bridge the digital divide and extend learning beyond the school 
day by connecting the dots between Comcast, the United Way, the Smart 
Chicago Collaborative, participating community organizations and 
school-based leaders, all of which will work in partnership to enhance 
access to broadband and provide technology training beyond school 
walls.'').
---------------------------------------------------------------------------
    Indeed, high-speed broadband Internet access throughout the day can 
enrich curricula and enhance the learning process by permitting 
students to use digital textbooks, work on multimedia projects, stream 
educational video content, conduct Internet-based research, take online 
courses that are not locally available, and interact with content 
experts around the world or right next door.\34\ And when we extend the 
broadband experience to the home, it even enhances the involvement of 
parents in their children's education. These digital tools can improve 
learning outcomes for our Nation's students and prepare the next 
generation for success in an increasingly competitive digital 
world.\35\ This only underscores the importance of today's topic and 
how we need to keep working harder to ensure that all Americans have 
access to broadband at home.
---------------------------------------------------------------------------
    \34\ See generally The Broadband Imperative: Recommendations to 
Address K-12 Educational Infrastructure Needs, State Educational 
Technology Directors Association (rel. May 21, 2012), at http://
www.setda.org/web/guest/broadbandimperative (``SETDA Broadband 
Imperative Report'').
    \35\ See, e.g., National Broadband Plan at 226 (``Broadband can be 
an important tool to help educators, parents and students meet major 
challenges in education.''); U.S. Dept. of Education, Press Release, 
Statement from U.S. Education Secretary Arne Duncan on FCC Action to 
Connect More Students to High-Speed Internet (July 19, 2013), at http:/
/www.ed.gov/news/press-releases/statement-us-education-secretary-arne-
duncan-fcc-action-connect-more-students-hi (``The U.S. once led the 
world in connecting our schools to the Internet, but our strongest 
international competitors are surging ahead of us because they know 
that giving students and teachers the right tools is vital to their 
economic strength.'').
---------------------------------------------------------------------------
    The efforts that those of us in this space have undertaken thus far 
are certainly commendable, but they are only a piece of the overall 
solution to the adoption gap. The focus needs to remain on increasing 
Americans' adoption of broadband at home, so that families can benefit 
from the innumerable benefits of the Internet. The existing obstacles 
to adoption cannot be eliminated with any magic bullet. We look forward 
to working with all stakeholders--within the broadband industry and in 
other sectors--to address the complex problems that remain.

V. Conclusion
    America's broadband past has been truly remarkable, and the future 
of broadband is even brighter. Our infrastructure keeps getting faster 
and better, as industry continues to invest in innovative new 
technologies, expand network deployments, and increase speeds. 
Consumers' choices have never been greater.
    While adoption continues to grow, it is not at an acceptable pace, 
and certain populations are still at a danger of being left behind. 
Every American must have the opportunity to participate in the wonders 
and practical benefits of the Internet. Making this a reality begins 
with a firm understanding of why these people are not using the 
Internet, and acting based on sound information to get the most return 
on our public policy investments.
    In particular, we need to continue public and private efforts to 
promote awareness of the social and economic benefits of the Internet, 
and to accelerate the development of digital literacy and computer 
skills. We need to continue efforts to get low-cost computer equipment 
into the homes of those who don't currently have it. We need to update 
and revitalize the E-Rate program to ensure that our classrooms have 
the bandwidth necessary to take advantage of the digital learning 
platforms that will prepare our children for the digital economy of the 
21st century. Finally, we need to continue to educate families about 
the availability and benefits of programs like Internet Essentials, so 
their children are connected at home just as they are at school.
    Comcast is working hard to do our part, and we're partnering with 
thousands of elected officials and community organizations to do so. I 
look forward to working with members of this Subcommittee on this 
important challenge. Comcast is firmly committed to engaging with 
Congress, the Administration, the FCC, and stakeholders from across all 
relevant industries to ensure that no American is left behind as we 
stride boldly into our exciting future.
    Thank you for the opportunity to testify today.

    Senator Pryor. Thank you. And congratulations on your 
millionth customer. That's big news.
    Let me, if I may, start with Senator Sununu, and what we'll 
do is 5-minute rounds here, and I'll try to actually keep my 
first couple short so that we can get to our other colleagues.
    But, Senator Sununu, I know that one of the things you are 
concerned about is the Internet tax moratorium. And tell us how 
you think lifting that moratorium--in other words, adding a tax 
to the Internet--how you think that might hurt adoption rates.
    Senator Sununu. Well, I think it's basic economic fact, 
when you tax something, you get less of it. So, you tax 
something, you raise the price; you tax something, you make it 
a little less attractive to invest; you tax something, you make 
it a little less attractive to put money behind the kind of 
deployment and access and, ultimately, adoption that we're 
talking about. So, we want to make sure that this 
infrastructure is as economically sound and robust as possible, 
and I think it certainly helps to prevent, not just the Federal 
Government, but states, cities, towns, all from being able to 
tax it.
    I--and I'll draw an analogy to the wireless industry, where 
this was a path that wasn't taken, and anyone can look at their 
wireless bill and look--as a result, there are local taxes, 
State taxes, Federal taxes that do affect the economic 
viability and the economic incentive to continue investment.
    Senator Pryor. Right. You mentioned, in your testimony, 
that you like the, quote, ``light touch regulatory approach,'' 
which doesn't surprise me, knowing you. But, what else can 
Congress do, or not do, that will help increase adoption rates?
    Senator Sununu. Well, in terms of the light tough 
regulatory approach, I mean, it's sort of a simple phrase, but 
I think it's a meaningful one. That was an intentional approach 
that really began under President Clinton. It has been largely 
followed by Congresses, by the FCC, and by administrations ever 
since. You know, things that might be done that would certainly 
hinder investment and innovation are regulations regarding the 
packaging, pricing and distribution of broadband services.
    David Cohen just talked a great deal about the evolution of 
the Internet Essentials Program. It's something that's changed 
over time and over the years, and there's no question that the 
private sector has much greater flexibility when it comes to 
innovation and packaging. And it's especially important now, 
frankly, within the broadband industry, as consumer habits are 
changing dramatically. Right? Where they access broadband--is 
it wireless, is it wired, is it for content, is it for 
information, is it for education, is it for entertainment? 
Being able to innovate and try different approaches in order to 
encourage the adoption we're talking about is very, very 
important.
    On the ``What can government do that's helpful?'' I'd just 
allude to, and let others expand on, the work that's been done 
by--within government--FCC and NTIA, and looking at that 
adoption toolkit, and highlighting the issues of perception and 
skills relevant to access and cost, as NTIA did, and then look 
for those partnerships, because everyone is challenged in a 
different way--communities, families, urban versus rural--and 
so that the way that you approach adoption in one particular 
part of the country or one particular demographic is going to 
be different. And so, you need to identify the problem you're 
trying to address, come up with a partnership that can address 
that problem.
    Senator Pryor. OK. Thank you.
    Mr. Cohen, I just have a minute left. Let me ask--you 
talked about your Internet Essentials Program, which sounds 
like it's a great success for the company and for your 
customers. You also talked about your idea of a continuum of 
connectivity. And I know that, as part of this--and you 
mentioned it in your testimony--you're doing digital literacy 
training for thousands of people in your communities. And do 
you see an increase in adoption rate after these folks have 
that digital literacy training?
    Mr. Cohen. So, this is one of the great struggles, and we 
do try and survey our Internet Essentials customers about this. 
And I don't think we have enough data yet for us to be able to 
demonstrate that digital literacy training increases adoption. 
But, all the data we've looked at, whether it's from the FCC or 
from Pew, is crystal clear that, to the extent families 
understand the Internet and understand the value of it and what 
it means, this does increase adoption. And it's one of the 
reasons we've focused on this school-aged population. The 
eligibility for Internet Essentials is having a child living in 
your household who's eligible to participate in the National 
School Lunch Program, because this is an interesting 
technology, in the sense that adoption may well be driven by 
young people because they understand the importance. They see 
other kids in their class going home and doing homework on the 
Internet. So, they may drive adoption for their parents and for 
their grandparents.
    And anecdotally, I can tell you that I have absolutely seen 
dozens of those stories, where parents have said, ``We didn't 
understand this until we heard about this from our children, 
from the teachers in the school, how important the Internet was 
and it wasn't just for playing games and for Facebook.''
    So, I think it's pretty clear that the digital literacy 
barrier here is a big one and it's a complicated one. And I do 
think--as Ms. McPeak said, there's a real role for the 
government in this space. I think it's an educational 
component, and I think the FCC and NTIA have helped to shine a 
spotlight on this and facilitate digital literacy training, and 
that, in the longrun, that is going to drive adoption.
    Senator Pryor. Good. I'll ask you about E-Rate in a few 
moments, but I want to first turn it over to Senator Wicker.
    Senator Wicker. Thank you, Mr. Chairman.
    And, Mr. Cohen, let me join our Chairman in congratulating 
you on your announcement of your one millionth person. I 
understand you've gone above and beyond the conditions imposed 
on you by the merger with NBCUniversal. Let me just ask you to 
comment on some testimony from Ms. McPeak.
    She advocates a setting of goals, and one of the things 
that struck me is, affordable broadband offers are required to 
increase adoption among low-income households. This is likely 
to require an affordable broadband lifeline rate program. Would 
you comment about your opinion concerning such a program?
    Mr. Cohen. So, I agreed with almost everything in Ms. 
McPeak's testimony, and you found the one paragraph that I 
probably----
    Senator Wicker. That's my job.
    Mr. Cohen.--don't fully agree with. So, congratulations.
    [Laughter.]
    Mr. Cohen. Now, for our company, I think we've demonstrated 
that a governmentally-designed and governmentally-regulated 
program is not the best way to go. And my concern would be that 
if you created a government-regulated rate-set Lifeline 
program, that what you'd have is a government-regulated, rate-
set program, but you wouldn't have anything to deal with the 
cost of computers, you wouldn't have anything to deal with 
digital literacy, you wouldn't have anything to deal with 
helping to drive adoption through community partners. The 
success of Internet Essentials has been based on this holistic 
approach and, quite frankly, the commitment of this company to 
doing what's right to drive adoption. And we've created that 
web of partnerships with community that Ms. McPeak talks about. 
And I can't underscore enough how important that is to be able 
to drive adoption.
    And if you try to regulate and, through government 
intervention, try and hit only one element of this equation, I 
don't think you'll end up with a successful program. I think 
encouraging the rest of the private sector or others in the 
private sector--and Senator Sununu noted, we're not in this 
alone; we have AT&T and Time Warner Cable and Suddenlink and 
Cox that all run programs--and I think encouraging those 
programs and encouraging the holistic approach of private 
sector, government, nonprofit sector, school boards, libraries, 
faith-based community to work together to drive adoption is the 
secret sauce that is going to move this needle.
    Senator Wicker. Ms. McPeak, what do you say to that? Sounds 
pretty good.
    Ms. McPeak. Mr. Cohen is personally very passionate and 
dedicated, and Comcast has done better than any other company. 
What David just said is that you need this very holistic, 
integrated approach. It's exactly what my testimony says, and 
spells it out.
    What I said about setting a goal is really important. 
Comcast Internet Essentials is going to expire next year. With 
all of the effort that has been invested by Comcast, they have 
not reached more than 8 percent of the eligible recipients. So, 
8 percent is not a success, when we have all of these people 
offline.
    We recommend that, in order to sustain that, because 
affordability is an issue, access to a computing device is an 
issue--Comcast has, for all intents and purposes, really set 
the market, they've set the price point that will drive 
adoption. It needs to be a much fuller engagement of community-
based organizations and digital literacy.
    We do have the data. We got the 200,000 adoptions through 
working with NTIA because of digital literacy, and we go back 
and we survey and we know it is sustainable. We fully integrate 
the use of technology, broadband and computing devices, into 
teaching and learning in a program we call School2Home. It 
fully engages the parents as one of those key elements of 
turning around low-performing schools. The worst of the worst 
schools are getting better academic performance today with the 
use of the technology, largely because the parents can stay 
connected with their kids' homework, with the teachers. The 
technology allows them to overcome their inability to go to a 
teacher conference because they might work two jobs or they 
don't speak English. It really is the mechanism for engagement.
    Senator Wicker. All without----
    Ms. McPeak. And here's the data----
    Senator Wicker.--all without a mandate.
    Ms. McPeak. Pardon?
    Senator Wicker. All without a government mandate.
    Ms. McPeak. Absolutely. Absolutely.
    But, let me, then, try to show the data and answer your 
question on why. Why does it become important to have at least 
either sustained partnerships--remember, I hit that over and 
over again. Any public investment that we make should be 
leveraged to the hilt, but partnerships between the Federal 
Government and states, between the private sector and public 
sector, and particularly providers in the community--it's that 
trusted messenger, that honest broker on the ground that makes 
a difference.
    In our School2Home Program, after both integrating the 
technology into the teaching and learning and improving 
academic performance beyond the statewide average or the 
district average in the lowest performing schools, we find 
that. There is broadband adoption that increases for Spanish-
speaking parents by 58 percent and by English-speaking parents 
by 12 percent. Those percentages that I just shared with you 
exceed all of the effort, in terms of adoption, that we have 
right now, in a voluntary sense.
    If there is not, either through industry or through 
government, an affordable broadband offer beyond next year, we 
will hit the wall, and have in California, on broadband 
adoption. So, somehow we need to figure this out.
    And our point is that, if the FCC, which is looking at an 
affordable broadband offer, makes that available, it should be 
with the encouragement incentives to have the partnerships that 
Mr. Cohen and I have talked about.
    Senator Wicker. Thank you.
    Senator Pryor. All right, thank you.
    Let's see. Senator Klobuchar.

               STATEMENT OF HON. AMY KLOBUCHAR, 
                  U.S. SENATOR FROM MINNESOTA

    Senator Klobuchar. Thank you, Mr. Chairman. Thanks for 
doing this hearing.
    And thank you, Senator Sununu, for coming back on this 
important topic.
    And I really do appreciate the work that Comcast is doing 
in this idea of partnerships. But, Senator Wicker was noting 
that there was no mandate, but there has been a lot of 
government funding. And I was just looking at this, you know, 
$4 billion alone out of the NTIA and the hope that we can use 
some more Universal Service funding for this. So, do you see, 
Ms. Wright McPeak, that we could just do this with the private 
sector?
    Ms. McPeak. Oh, I think that any public investment, whether 
it's at the Federal level or the state level or the local 
level--and nobody finds somebody that is more frugal than I am; 
they--everybody thinks I am actually much too frugal, and I 
come out of a business sense.
    May I add that, on NTIA's broadband adoption program, it 
was $450 million, so most of the funding in BTOP through ARRA 
was actually deployment, it wasn't adoption. So, it was modest, 
in the sense of an investment in adoption, which I think makes 
sense if we're trying to close the digital divide. We cannot be 
globally competitive with the 20, 30 percent of our citizens 
left behind in the Digital Age.
    There are many ways to leverage partnerships. It begins 
with, ``Can, in fact, the Federal Government connect dots in 
your own program, or programs?'' May I suggest just a couple of 
examples? And it goes to, then, the partnership question.
    The FCC funded pilots for Telehealth. There is now a $400 
million annual fund for the Healthcare Connect Fund for 
Telehealth. Over on HHS side, there is not an active pursuit of 
getting all federally qualified health centers or critical care 
hospitals or public health facilities onto a Telehealth 
network.
    I gave you the example about education. It's not, today, 
the policy of the Department of Education to say every grant we 
put out should optimize the use of technology and computing 
devices.
    The HUD does not require that publicly subsidized housing 
encourage the connectivity of broadband.
    Those are examples.
    When those kinds of policy dots are connected through the 
Federal Government and, on top of that, you say, ``We want to 
give priority or incentives to those programs that have 
partnerships--partnerships with the state that align their 
efforts, partnerships with the private sector''--now we finally 
have optimized what Congress can do in directing broadband 
adoption.
    Senator Klobuchar. So, you say that, given that we still 
are clearly having issues with adoption, that----
    Ms. McPeak. Oh----
    Senator Klobuchar.--a few requirements here and there might 
make a difference.
    Ms. McPeak. It--but, what I----
    Senator Klobuchar. OK, I've got to--I want to move on to my 
hometown witness, here, but, would that be correct, that the 
requirement----
    Ms. McPeak. Yes, I am saying that.
    Senator Klobuchar.--should be helpful----
    Ms. McPeak. I am saying that.
    Senator Klobuchar.--whether you call them mandates or 
requirements?
    OK. Ms. Jocelyn, thank you for coming, and thank you for 
your incredible work that you're doing with Blandin. At the end 
of McPeak's questions with Senator Wicker, she was talking 
about schools. And I think the numbers that I have here is 
that, according to the study by the Federal Reserve Board, 
graduation rates for students with computers at home are 6 to 8 
percent higher than students without them.
    Ms. Joselyn. That's right.
    Senator Klobuchar. Your experience in Minnesota, especially 
on the tribal reservations, what have you seen when kids don't 
have computers?
    Ms. Joselyn. Well, thank you for the opportunity to address 
that question. In terms of the quality of education and having 
a level playing field for all children of America so that the 
quality of your educational experience is not dependent upon 
where you live, broadband is absolutely essential. And I can 
give you a specific example in our home county of Itasca 
County, up in north central Minnesota, where we have very 
small, spread out school districts that are the size of some 
States, and it's just not physically possible to offer the 
quality and breadth and depth of educational opportunities that 
are available in more urban centers. We are now, through 
availability of broadband access and adoption education 
efforts, to offer to our students a stunning array of 
educational opportunities that would otherwise be unavailable 
to them, including Ojibwe language training, physics, high 
level math, specific literature courses that, through a 
consortium effort, when school districts come together and use 
this technology platform, they are able to offer world-class 
educational opportunities that would otherwise be unavailable 
to our students. And we certainly believe, I'm sure, that, in 
our nation, we want equal opportunity for all. And growing up 
in a rural area should not prejudice your educational 
opportunity.
    Senator Klobuchar. Thank you. And the other thing I 
remember from those northern Minnesota counties is how, with so 
few people having the Internet access--and still a lot of them 
don't even have access, much--good access--is that the 
libraries became increasingly important, because there--
literally would have waiting lines for people to try to apply 
for jobs. And I think that's something else we have to 
remember, especially--our state now is down to 5.1 percent 
unemployment, and yet a lot of people are having trouble 
getting trained for or accessing jobs. And I would like that, 
instead of having the brinkmanship we've been engaging in, in 
the last few months, to be engaged in discussions about the 
workforce training and how we get people trained for the jobs 
so we can actually compete in the economy that's in front of 
us.
    Ms. Joselyn. Thank you.
    Senator Klobuchar. So, thank you.
    Ms. Joselyn. Thank you, Senator. And I would just add, if I 
may, that in Minnesota, we are program rich and systems poor. 
And part of what the Federal investment in this BTOP effort has 
allowed us to do is to align systems at the state level with 
community-based efforts, in partnership with the Federal 
Government. And the return on investment for our Nations and 
our children's future has been very impressive.
    Senator Klobuchar. Thank you.
    Senator Pryor. Thank you.
    Senator Rubio.

                STATEMENT OF HON. MARCO RUBIO, 
                   U.S. SENATOR FROM FLORIDA

    Senator Rubio. Thank you.
    Thank you all for being here today. This is an incredibly 
important issue, I think, for the future of the country, even 
though it's not going to be on the headlines tomorrow morning. 
So, that's why I wanted to ask you.
    So, if I went back home now--and I know the answer to this, 
although I'm not sure I can fit it on a bumper sticker--but, if 
I went home today and I explained to somebody, ``This is a 
really important issue, 30 percent of the population has no 
access to broadband, and it's bad for the country, bad for our 
economy, and bad for them, for the folks that don't have 
access,'' how would you say that I'm trying to figure out how I 
can make this issue more relevant to people, in terms of why it 
is that it's good for the country that we get more people to 
have access to broadband.
    Mr. Cohen?
    Mr. Cohen. So, Senator, I'll tell you, the two items that 
came out of our research on this that would be drivers to cause 
people to want to sign up for the Internet, one is almost a 
bumper sticker. Eighty percent of Fortune 500 companies today 
only accept job applications online. So, if you want to apply 
for a job--and it goes to what Senator Klobuchar was just 
talking about--you need to have access to the Internet to be 
able to apply for a job.
    And the second, a slightly different population but I think 
equally compelling, is to peg this to educational achievement 
and attainment. Twenty-first century education today is vastly 
enriched by digital learning platforms, by digital curriculum 
that is offered in schools but that is integrally tied to being 
able to work on the Internet after school and at home, to 
enable parents to communicate with teachers, teachers with 
parents, to track what their kids are doing, what their 
strengthS are, and what their strengths are not.
    There's another Pew study which says that 79 percent of 
teachers today are assigning homework that requires access to 
the Internet out of school and after school to be able to do 
that homework.
    So, if you want your kids to be competitive for 21st 
century jobs, to have 21st century job skills, you need to have 
Internet access at home to be fair to your kids and enable them 
to keep up with other kids in their classrooms and other kids 
elsewhere in the state, in the country, and in the world.
    I think those are two big motivating factors for parents: 
getting a job and educating your kids.
    Senator Rubio. So, now the number is 70 percent. And I 
would imagine there's some cohort out there that's never going 
to--for example, my mom is in her mid-80s. She's never going to 
be Internet savvy, for all the reasons you've outlined--but, 
that's not who we're talking about. Beyond that, what is a 
realistic goal for the country?
    So, if we said--and obviously it's a different issue, but, 
you know, when President Kennedy said we'd be on the Moon by 
1969 and return someone safely--what is a realistic goal for 5 
years, 10 years from now, in terms of the number--the 
percentage of Americans that we would have, beyond the 70 
percent?
    Ms. McPeak. I can share with you what we have said in 
California, which is 80 percent by 2017. Eighty percent 
adoption, statewide----
    Senator Rubio. By 2017?
    Ms. McPeak. 2017. And no one region and no one demographic 
group less than 70 percent. And we started really low. I mean, 
we were at 55 percent nation--statewide. Low-income families 
were at 33 percent.
    Senator Rubio. And then I guess my last question is--
obviously, I've heard, or read, basically in all of your 
testimony, about the need for a multifaceted plan, that there's 
not one singular thing that we can do to move people, to get 
those numbers up. It will require a host of different issues. 
Probably the most interesting one--and I forget whose testimony 
it was; I read them all--was how--and this is the one issue 
where it's the children and the younger, you know, Americans 
that are bringing the rest of the family in, in some way, 
shape, or form.
    So, I guess going back to--on the educational front--it's 
one of the things I'm really interested in, how we can 
incentivize Internet literacy. I mean, if you're talking about 
teaching kids things that are relevant for the 21st century, it 
is unimaginable that one of--that you could have an educational 
system that isn't teaching Internet literacy and technology 
literacy as part of a curriculum that is relevant to the 21st 
century.
    A lot of the focus we have here as policymakers is on 
infrastructure. I think that's important, too. And I think I'm 
really interested in wireless, for a second, because I think 
that we've focused a little bit today on access at home, but 
we're an increasingly mobile society, not just in how we live 
our lives, but, you know, the equipment that we use to access 
the Internet.
    In full disclosure, nowadays I very rarely go online on a 
laptop; it's always on a mobile device. And I think a growing 
number of Americans are going to find themselves in that 
position. Hence, these wireless networks are incredibly 
important. And, to that, the availability of competition in 
broadband is a key part of it.
    And again, when I describe that to people and I talk about 
broadband, their eyes glaze over a little bit, because no one's 
made the connection. But, how critical is that, the wireless 
component?
    Mr. Cohen. First of all, I do think wireless is important, 
and I include in wireless Wi-Fi, just so we're clear. But, I do 
think devices are increasingly mobile. And, by the way, even if 
you don't use a laptop, I think we could do a show of hands of 
how many people use a wireline connection even when they are 
using a laptop, because even people using a laptop are most 
frequently on wireless or Wi-Fi or some wireless technology.
    So, I do think wireless is important. And Senator Pryor I 
actually referred briefly, in my oral statement, to the fact 
that we need innovate solutions to deal with the deployment 
gap. And I think technology is increasingly going to be the way 
in which we reach the millions of Americans who don't have 
broadband deployed to them. Because I think wireless deployment 
may well be less expensive, more capable--more capable of 
closing that gap in a more efficient and a faster way. So, I 
think a variety of wireless technologies is going to be very 
important to closing the deployment gap, and having--allowing 
people to have wireless access to their broadband connection is 
very much going to be a part of society, going forward.
    I'm sorry, Senator, I just have to say one thing. This 
comes more anecdotally, in discussions with teachers, with 
parents, et cetera. It is still really hard to write a term 
paper on even a tablet. One of my horrible----
    Senator Rubio. That's true.
    [Laughter.]
    Mr. Cohen.--stories is that I met a mother in Atlanta who 
was signing up for Internet Essentials, and she came up to me, 
crying, thanking me for the program. And I said, ``You're very 
welcome.'' And she said, ``Mr. Cohen, you don't understand what 
a difference this is going to make in our lives.'' And I said, 
``What do you mean?'' She says, ``I''--she had two kids. She 
says, ``I'm deeply committed to their education. We couldn't 
afford Internet at home. I do have a smartphone from work. And 
what I used to do is, 4 nights a week after dinner, I would 
drive to a McDonald's and park in the parking lot, where they 
have free Wi-Fi, and I would hand my smartphone into the 
backseat, and my kids would share the smartphone and do as much 
of their homework as they could.''
    Senator Rubio. Yes.
    Mr. Cohen. But, you can't--and she said, ``You can't write 
a term paper on a smartphone.''
    Senator Rubio. And that's just an indication--I don't write 
a lot of term papers these days.
    Mr. Cohen. Right. So, I just----
    Senator Rubio. But, all my kids are working off----
    Mr. Cohen. Right. So, all I'm saying is, I think----
    Senator Rubio. No, that's true.
    Mr. Cohen.--it goes, really, again, to the integrated 
needs, here, that you have to cross the entire spectrum and 
have deep partnerships and have multiple technologies and 
multiple ways for people to be able to access the Internet, 
just like all of us have.
    Senator Rubio. Right.
    Senator Pryor. Thank you.
    Mr. Cohen, let me follow up with that a little bit. You 
mentioned technology may be the solution. And obviously, your 
company has seen a rapid change in technology, rapid 
development. And you guys have been an innovator there. But, 
also, I was going to ask about E-Rate for our schools. And it 
kind of goes back to what you were saying a moment ago, with 
the story--this anecdotal story you had in Atlanta.
    But, the FCC currently is looking to update the E-Rate 
program. You know, I personally feel like it's been pretty 
successful. But, they want to look at it and evaluate it and 
see if they can make it better, maybe expand it. And I'm 
curious about your thoughts about should we try to find ways to 
get more E-Rate dollars and make those available to schools, 
and even libraries?
    Mr. Cohen. OK. So, a really important question---- and if I 
could pair the FCC's E-Rate proceeding with the President's 
ConnectED initiative, because I actually think they're related 
to each other. Obviously, the President announced a goal--he 
was listening to Ms. McPeak--and said that 99 percent of the 
schools in America should have ultra-high speed Internet 
connections within the next 5 years. And I think that's an 
important goal, because, with the digital learning platforms 
that are out there, I think it is essential that all of our 
schools have the capacity to be able to offer the educational 
enhancements within the school to all students in this country, 
regardless of the communities where they live.
    E-Rate has obviously been the primary funding mechanism for 
Internet connections to schools and to libraries. And so, I 
think the FCC's recent proceeding to looking at the E-Rate 
program and to ask the question how is it working? How could it 
be retooled? What are improvements that could be made in the 
program?--will be essential to accomplishing the objectives 
that are set forth by the President in the ConnectED 
initiative.
    Now, I'm not a critic of the E-Rate program. I would agree 
with you that it has done a lot of good in this country. But, 
it has been around for a long time. And it was created, quite 
frankly, in a time where a completely different set of 
technologies ruled. And so, we're very supportive, as a 
company, of that proceeding and think that there are 
enhancements that could be made to the program.
    I'll just note one issue, because I know we're in a tight 
timeframe, but I'm happy to come back to it. I think the most 
critical item that I would focus on around the educational 
aspects of technology is that it's important, not only to bring 
ultra-high speed Internet service to the school, but to 
disseminate that service throughout the school. So, it's not 
enough--I mean, Comcast delivers, to thousands of schools, 100-
meg-plug connections of Internet, yet we know, in most of those 
schools, that service is not being disseminated throughout all 
the classrooms in that school. Maybe it goes to the central 
office or computer lab, maybe there to two or three computer 
labs, maybe to a small pocket of classrooms. But, if you're 
going to accomplish the educational attainment objectives, 
which is what we're all interested in--we're not interested in 
connectivity for connectivity's sake; we're interested in 
improving student achievement, improving graduation rates, 
improving the delivery of 21st-century skills--you've got to 
disseminate that high-speed data service throughout the school.
    In the current E-Rate program, Internet connections to the 
school are known as Tier 1, and then the dissemination 
programs, getting that high-speed data connectivity throughout 
the school, are known as Tier 2. Just the way they define it 
tells you everything you need to know about the service. The 
priority has been on Tier 1. Tier 2 has been underemphasized, 
has not really been a focus of the E-Rate program. And, to make 
this work with the modern technology--and Senator Rubio was 
talking about that--the mobility of devices--you've got to 
disseminate the speed within the schools, which is going to 
require a reallocation of attention between so-called Tier 1 
funding and Tier 2 funding. That's just one example.
    Senator Pryor. Thank you.
    Senator Ayotte, you ready?

                STATEMENT OF HON. KELLY AYOTTE, 
                U.S. SENATOR FROM NEW HAMPSHIRE

    Senator Ayotte. Yes. Thank you very much, Mr. Chairman.
    First of all, I want to thank all of you for being here.
    It's really an honor to have Senator Sununu, given 
everything that he did for our state. I want to ask you about 
New Hampshire, because I think, having served admirably on this 
committee and with all the great work you're doing now on 
broadband issues, you appreciate very much the challenges that 
we face, particularly in some of the more rural counties of 
Coos, Grafton, and Sullivan with this issue of broadband 
deployment and access.
    So, I just wanted to get your thoughts on how, in a state 
like New Hampshire, we really can do better, particularly when 
we think about the North Country, the economic development 
opportunities there with broadband.
    Senator Sununu. Well, you know, in New Hampshire, we 
generally have higher levels of deployment, access, and 
adoption than the national average, but, without question, 
there are still communities that are underserved, and there are 
still the same challenges that we have with adoption that other 
parts of the country see. So, you know, it's an indication of 
the pervasive challenges that are faced, even in a part of the 
country that's considered relatively high-tech and has 
relatively high levels of access or deployment, adoption's a 
challenge.
    I think it gets back to the kind of partnerships we've been 
talking about. You know, providers working with community 
organizations to understand why is adoption lagging, providers 
working with the school systems to identify opportunities to 
improve digital literacy. Time Warner Cable, obviously a 
company that I've worked with now for almost 5 years, is a big 
promoter of Connect a Million Minds initiative, over $100 
million in the last 4 or 5 years to drive digital literacy in 
the schools. So, you know, that's the adoption side.
    On the access side, though, as you point out, northern New 
Hampshire, we don't have the speeds that you'd like to see. You 
don't necessarily have the infrastructure that you'd like to 
see. Some communities are still served by legacy infrastructure 
that might even meet the technical definition of broadband, say 
over 3 or 4 megabits per second, but isn't driving the 
community into the 10 or 20 megabits per second----
    Senator Ayotte. Right
    Senator Sununu.--per second that's so important to the 
economy.
    So, there, it's a question of, you know, funding, in part, 
and, again, both by the private sector--so, the local 
provider--but, in many cases, some of those rural communities 
have benefited from their effort to work with the Federal 
Government, whether it's FCC, NTIA, or other programs.
    Senator Ayotte. And one of the issues that I've been very 
critical of here in the Committee is, frankly, the Universal 
Service Fund, because New Hampshire is a net donor of nearly 
$25 million annually to the fund, and the reality is, as you 
just identified, Senator Sununu, there are real needs in New 
Hampshire. And so, I've been very concerned that this doesn't 
make economic sense for a state like New Hampshire, the way the 
distribution is done. So, I certainly wanted to get your 
thoughts on that issue, because, when we talk about funding, I 
think that rises to the top of my mind.
    Senator Sununu. Well, thank you very much for drawing me 
into an issue that's, generally speaking, outside the purview 
of broadband for America.
    [Laughter.]
    Senator Sununu. But, I will offer a few thoughts, because 
look, it's a really important----
    Senator Ayotte. Well, you know how hearings are.
    [Laughter.]
    Senator Sununu.--it's a really important issue. I'm 
obviously joking a little bit, but it--look, it's an important 
issue because of the amount of money you're dealing with, 
because of the potential to reform and revise the program and 
make it work better.
    And I'll couple this response to the E-Rate response, in 
that I would argue both of these programs, E-Rate and Universal 
Service, they were originally targeted for very specific goals. 
Right? Universal Service obviously bringing phone service to 
all parts of the country. The E-Rate for that Tier 1 
connectivity on schools--that was the original goal.
    And today, as we look at the landscape, the needs are very, 
very different. And I think, in both cases, those programs have 
lost their focus, the resources are not well targeted, so 
they're really not effectively targeted at communities that 
have greater economic need, not very well focused at 
communities that have greater infrastructure need. And so, in 
the case of Universal Service, I think you can fairly argue 
that much of the money is being used to provide subsidies to 
parts of the country that are already served by----
    Senator Ayotte. Correct.
    Senator Sununu.--two or three or four wireless carriers 
very effectively, and, in effect, almost universally.
    In the case of the E-Rate, I think you can very fairly 
argue that a good deal of the resources go to subsidize the 
Internet connectivity of fairly well off suburban school 
systems. And we're all concerned about education, but that is 
not an effective targeting of those resources, when you have 
all of the challenges that are both economic, demographic, 
associated with adoption.
    So, in both cases, Universal Service and E-Rate, I would 
encourage you to roll up your sleeves, because it's not easy, 
there are a lot of politics here. I--you know as well or better 
than I. But, it's a lot of money at stake that could be used 
far more effectively to deal with the issues of adoption, 
literacy, improving perception, and helping to drive the 
digital economy that we know is so important in the 21st 
century.
    Senator Ayotte. Thank you.
    I know that my time is expired, but I could not agree more. 
I do hope that we do roll up our sleeves on USF and E-Rate so 
that we are making sure that those dollars are accomplishing 
what we all want to accomplish, and particularly given the 
nature of technology, so we're acknowledging the changes that 
are made. So, I really hope that we're able to take that up, 
Chairman.
    Thanks.
    Senator Pryor. Thank you.
    Senator Wicker.
    Senator Wicker. Ms. McPeak, you were nodding vigorously 
during Senator Sununu's answer to the final question. Would you 
elaborate, briefly?
    Ms. McPeak. I would. And we have it in our testimony. We 
said, ``Reform E-Rate and Universal Service's Fund, target it 
to the most needed areas.'' So, that's basically unserved areas 
that tend to be rural and urban poor neighborhoods. Target 
those resources and leverage them to partnerships. That's what 
we said.
    We have a lot in common with New Hampshire, if I might just 
comment, Senator. We, too, are a donor state. You've named 
three counties. We've got 16 that have a population of 2 
million, exceeds the population of New Hampshire, and they're 
spread out on 44,000 square miles. That's a state of Kentucky 
inside California. And these are communities that, if I were 
answering Senator Rubio, ``Why do this?''--because economic 
development will go there, and they will be able to pay more, 
even if we are a donor state. And all of the disadvantaged 
residents in my state will actually get an education, get a 
decent living, and become taxpayers to contribute to the 
overall well-being of America.
    Senator Wicker. Now, having found some agreement and like-
mindedness between Ms. McPeak and Senator Sununu, let me ask 
you, Senator Sununu: when there was an exchange between Senator 
Klobuchar and Ms. McPeak about requirements and mandates, did 
you begin to worry that we were intruding on the light 
regulatory touch that you advocated?
    Senator Sununu. Yes, a little bit.
    Senator Wicker. And would you care to elaborate?
    Senator Sununu. Sure. I feel self-conscious, because I feel 
like I've eaten up too much of Senator Ayotte's time and your 
time, my longer answers. But, there's no question that that 
raises some concerns.
    And the fundamental reason is because things are changing 
very quickly in this space. So, let's talk about, for example, 
a hard target for adoption rates. Well, first and--if you had 
set that target just a couple of years ago, the exclusive focus 
would have been on wired broadband connections. But, as we just 
heard, 80 percent of the country has actually adopted wireless 
broadband connections and America is leading the world, in 
terms of technology and deployment of 4G--well, high-speed 
wireless broadband. So, if you had set that target and focused 
exclusively on--set that target thinking about wired broadband, 
you might have limited or inhibited both investment of that 
wireline and maybe of the wireless.
    It's hard to say where we'll be 2 or 3 years from now. Not 
that we should promote the adoption, but I don't think there's 
a magic number. I don't think there's one specific technology. 
I don't think there's one specific price point. You know, if we 
were to say, ``Here's what the Internet Essentials price point 
has to be,'' that's not going to be right for every company in 
every part of the country with every demographic, because you 
have questions about what's included with--does that include e-
mail? Or do you have flexibility what you can package with 
that? You know, what is your customer? What other hurdles do 
they have? You know, whether it's $9.95 or $10.95 or $12.95, 
that might not make any difference to someone that doesn't have 
that computer.
    So, the hard mandate on price or packaging or the magic 
number adoption rate, I think risks limiting innovation and 
flexibility in this area, and, as a result, can potentially 
become counterproductive.
    Senator Wicker. Thank you, Senator Sununu--Mr. Cohen, is 
Internet Essentials going to go away in a year?
    Mr. Cohen. So, I don't have an answer to that yet. And I 
would say, by the way, that it is a weakness, if you will, to 
the extent there is a weakness, of governmentally-defined 
programs, because the only evidence that anyone would cite that 
it's going to go away is that the FCC order, in connection with 
the NBCUniversal transaction, obligates us to offer the program 
for 36 months after we launch the program.
    So, I'm not trying to be cute. We have not made a 
definitive----
    Senator Wicker. You have not made----
    Mr. Cohen----decision.
    Senator Wicker.--a decision.
    Mr. Cohen. We love the program. I think the passion for the 
program that the whole company has demonstrated has been 
crystal clear, and we'll have an announcement, in due time, and 
then maybe we'll never have to make an announcement again 
because there won't be any ambiguity that the program is a 
Comcast program that we're doing because we're passionate about 
it and it's the right thing to do. It----
    One thing I will add, because it's important to say this, 
is, one of our commitments has been that, if we were ever to 
stop this program after 3 years, everyone who's in the program 
gets the benefit of the 9.95 price for as long as they have a 
child eligible to participate in the National School Lunch 
Program. Not the same child they have today, necessarily. So, 
20 years from now, if you have a child who's eligible to 
participate in the National School Lunch Program, you'd still 
be eligible for the $9.95 price. So, in that extent, the tail 
of this program, regardless of what we decide, is a 15-, 
20-, 25-year tail for eligible families.
    Senator Wicker. Thank you.
    Mr. Chairman, at this point, I have a unanimous consent 
request. Connected Nation has been delivering to the NTIA data 
on broadband availability and adoption for some 10 states. 
This--they have prepared some testimony, which they would have 
given, had they been included. This brings to the Committee's 
attention several of the findings of their work. The testimony 
provides state-specific broadband adoption information from 
States such as Minnesota, Nevada, and South Carolina, and also 
includes data they have collected on broadband adoption by 
businesses in the United States, an important aspect of 
broadband adoption that we should remember--the connection 
between broadband and the economy.
    And I would like to ask unanimous consent that this 
testimony on--prepared by Connected Nation be accepted as part 
of the record.
    Senator Pryor. Without objection, it'll be accepted.
    Senator Wicker. Thank you very much.
    [The information referred to follows:]

       Prepared Statement of Tom Koutsky, Chief Policy Counsel, 
                            Connected Nation
Contents

I. Introduction

II. Current State of Broadband Adoption

        A. Residential Adoption

        B. Business Adoption

III. The Challenges That Remain

IV. Conclusion
                                 ______
                                 
I. Introduction
    Connected Nation applauds the Senate Commerce Committee and its 
Subcommittee on Communications, Technology, and the Internet for 
holding this important hearing on broadband adoption and welcomes this 
opportunity to submit written testimony on this topic of national 
interest. Chairman Pryor, Full Committee Chairman Rockefeller, Ranking 
Member Wicker, and Members of the Subcommittee are to be commended for 
keeping this issue in the spotlight, as Connected Nation and its state 
programs across the United States have consistently asserted that 
broadband adoption and use is as important as the ubiquitous 
availability of broadband.
    Connected Nation is a nonprofit organization that works with 
states, local communities, and technology providers to increase 
broadband adoption and digital literacy for all Americans--both urban 
and rural. For over 10 years, Connected Nation has worked directly with 
states, local leaders, consumers, and broadband providers to build 
public-private partnerships to identify gaps in broadband service; 
understand broadband and computer adoption barriers in communities; 
develop grassroots technology planning teams in communities for 
improved broadband adoption, and provide computers along with 
technology literacy programs for low-income and disenfranchised people. 
We work on behalf of American consumers, and we continue to find, time 
and again, in communities across our nation, that unserved and 
underserved people can and will overcome broadband challenges when the 
public and private sectors work together toward meaningful solutions.
    Connected Nation also has the privilege of working through the 
United States Department of Commerce, National Telecommunications and 
Information Administration (NTIA)'s State Broadband Initiatives (SBI) 
program in nine states and the territory of Puerto Rico. The SBI 
program was authorized by the Broadband Data Improvement Act of 2008 
(Public Law 110-385), legislation that originated in this committee and 
would not have passed without the Committee's leadership on this issue.
    As technology evolves, broadband's impact has extended into every 
aspect of our society including education, government, healthcare, and 
economic development. A citizen's or business's ability to effectively 
use a computer, software applications, and the Internet are essential 
in ensuring that they, regardless of their demographic, location, or 
income, have the skills needed to be competitive in today's employment 
market. According to the FCC, over the next 10 years, it is estimated 
that 80 percent of jobs will require digital literacy skills making 
broadband adoption absolutely vital.
    The expansion of broadband adoption among U.S. residents will lead 
directly to a more educated and trained workforce, a stronger economy, 
and healthier citizens. For this reason, Connected Nation is focused on 
equalizing digital opportunities so that all Americans can get access 
to high speed Internet and all it has to offer. Broadband is a tool, 
and like any other it must be used to produce results--this is the 
measure by which we will gauge the true success or failure of our 
efforts.
    Through the SBI, Connected Nation has been delivering to the NTIA 
data on broadband availability and adoption for 10 states and 
territories (Alaska, Iowa, Michigan, Minnesota, Nevada, Ohio, Puerto 
Rico, South Carolina, Tennessee, and Texas).
    In this testimony, I will bring to the Committee's attention 
several of the findings of this work. In each of these states, 
Connected Nation has placed an emphasis on the topic of broadband 
adoption as State Programs work daily to research, map, and implement 
community-based projects centered on adoption.

II. Current State of Broadband Adoption
    Connected Nation and its programs have been most successful at 
stimulating broadband adoption by inspiring and empowering communities 
to lead local initiatives that both reach out to disadvantaged 
populations and non-adopters and also spur the creation of local 
applications, which generates a higher level of relevancy that in turn 
spurs adoption.
    However, these adoption programs do not and are not designed to 
function alone and should be part of a comprehensive and larger 
statewide or regional broadband initiative for maximum effectiveness 
and sustainability.
    When we examine the state of U.S. broadband through the prism of 
demand (adoption) and supply (infrastructure), it is abundantly clear 
that the Nation's ``demand gap'' is significantly larger than the 
``access gap.'' And yet, until the Broadband Data Improvement Act of 
2008, the Sustainable Broadband Adoption grant program implemented in 
2009, and the National Broadband Plan completed in 2010, very little 
national attention had been placed upon broadband adoption as a 
national policy challenge. Since that time, we have seen significant 
movement and attention to broadband adoption at the national level. 
Approximately 30 percent of the adult population does not subscribe to 
broadband, and this gap is wider for minorities, for the low-income 
population, and for the elderly. And we are beginning to understand the 
barriers and challenges to adoption--digital literacy, cost, privacy, 
and others.

A. Residential Adoption
    Connected Nation's 2012 research surveys conducted as part of our 
Iowa, Michigan, Minnesota, Nevada, Ohio, South Carolina, Tennessee, and 
Texas programs estimate an aggregate household broadband adoption of 70 
percent. Minnesota and Nevada lead this group of states, with the 
highest broadband adoption rates at 78 percent and 75 percent, 
respectively.\1\ Figure 1 shows the adult adoption rate in each of 
these states surveyed. The rates of adoption among certain demographic 
groups are even lower, as shown in Figure 2.
---------------------------------------------------------------------------
    \1\ State Broadband Data and Development Grant Program Notice of 
Funding Availability defines broadband as ``Data transmission 
technology that provides two-way data transmission to and from the 
Internet with advertised speeds of at least 768 kilobits per second 
(kbps) downstream and at least 200 kbps upstream to end users . . .'' 
http://www.ntia.doc.gov/frnotices/2009/
FR_BroadbandMappingNOFA_090708.pdf



                                 ______
                                 
                                 
                                 
    The challenges that remain, five years after the enactment of the 
Broadband Data Improvement Act and over four years after the creation 
of the Broadband Technology Opportunities Program at NTIA and the 
Broadband Initiative Program (BIP) at the Department of Agriculture, do 
not mean that progress has not been made. In fact, Connected Nation 
has, as a benefit of conducting its research in multiple years, been 
able to track significant gains in household broadband adoption rates, 
with an average increase in household adoption between 2011 and 2012 of 
five percentage points. (See Figure 3).




B. Business Adoption
    Whether businesses are adopting and using broadband technology to 
the maximum extent is frequently overlooked by researchers--and it 
should not be, given the important impact broadband can have on small 
business productivity and job growth. As part of our SBI programs, 
Connected Nation frequently surveys business establishments to assess 
their adoption and use of broadband. That research has demonstrated 
that there are significant gaps in broadband adoption and use in 
various business sectors. In 2013, our research indicated that in the 
states surveyed, only 76 percent utilize broadband, meaning that nearly 
one in four business establishments do not utilize broadband. (See 
Figure 4).




    There are plenty of missed opportunities for economic growth and 
job creation if the United States were to close this business broadband 
adoption gap. Connected Nation has found that annual median revenues 
for businesses that use broadband are $300,000 higher than those 
businesses not using high-speed Internet service.\2\ Small businesses 
that have adopted broadband report annual revenues that average 
$100,000 higher than those not connected, and based on Connected 
Nation's data, we estimate that there are 1.8 million businesses across 
the U.S. today not using broadband to create efficiencies that lower 
costs, increase revenues, and help them, grow and create jobs.
---------------------------------------------------------------------------
    \2\ Connected Nation 2013 Business Survey: http://
www.connectednation.org/survey-results/business
---------------------------------------------------------------------------
III. The Challenges That Remain
    It is one thing to identify the broadband adoption gaps--it is 
quite another thing to explain them. Based on the findings of various 
business and residential surveys, Connected Nation engaged in a series 
of research projects aimed at more fully understanding some basic 
barriers to broadband adoption: Cost, Location, Digital Literacy and 
Education, and Demographic.
    When analyzing all the states in which Connected Nation is engaged, 
the main barrier to broadband adoption was found to be relevance (see 
Figure 5). Relevance represents a non-adopter's feeling that there is 
little of interest to them on the Internet. This barrier to adoption 
can be addressed through campaigns to educate the public on the 
benefits of broadband, digital literacy training, and lifelong learning 
initiatives. The nation's public libraries are frequently at the 
forefront of all of these efforts, and Connected Nation works closely 
with the library community to help make sure that these facilities have 
adequate facilities and staff to meet this growing demand.




    Our research shows that the barriers to home broadband adoption 
vary significantly by state, as Figure 6 demonstrates. For example, in 
Minnesota, the largest barrier to adults that have not adopted 
broadband is overwhelmingly relevance. However, in South Carolina and 
Nevada, the largest barrier to adoption is cost.



    Below are descriptions and links to various papers analyzing each 
topic in various states:

        A. Cost

        23 percent of respondents state that the cost of broadband is 
        the main reason they do not currently purchase and/or use 
        service. However, our data indicate that this sensitivity to 
        price varies across different vulnerable demographic groups. As 
        we show in Figure 7 below, 53 percent of non-adopters indicate 
        that they would not subscribe to broadband even if it was 
        offered at a price they considered ``acceptable.'' To be 
        effective, then, programs aimed at addressing the cost barrier 
        to adoption need to be targeted to groups and demographics that 
        will respond to these price signals.
        
        

        This research, and white papers on it produced by Connected 
        Nation titled ``Late to the Party: How New Broadband 
        Subscribers Compare to Early Adopters'' (2011) and ``Let's Make 
        a Deal: Price Sensitivity and Willingness to Pay in the 
        American Broadband Market'' (2012), were the focus of a 
        Connected Nation presentation to the FCC in February of 2013, 
        as a part of the Commission's 2013 Broadband Summit: Broadband 
        Adoption and Usage--What Have We Learned?''

        Because the receptivity to price incentives will vary by 
        demographic group, Connected Nation therefore recommends that 
        policy makers or marketing strategists should complement price 
        incentive strategies with programs addressing other barriers to 
        entry such as awareness campaigns, and digital literacy 
        training.

        The Federal Communications Commission is taking this approach 
        as to how it has structured its Lifeline broadband adoption 
        pilot projects, which combine price subsidies with efforts 
        designed to conquer other barriers to broadband adoption.

                a. Connected Nation, ``Late to the Party: How New 
                Broadband Subscribers Compare to Early Adopters,'' 
                http://papers.ssrn.com/sol3/papers.cfm?ab
                stract_id=1995130

                b. Connected Nation, ``Let's Make a Deal: Price 
                Sensitivity and Willingness to Pay in the American 
                Broadband Market,'' http://papers.ssrn.com/sol3/
                papers.cfm?abstract_id=2033415

                c. Connect South Carolina, ``Cost as a Barrier to 
                Broadband Adoption: Structuring Subsidy Programs That 
                Work,'' http://www.connectsc.org/sites
                /default/files/connected-nation/South%20Carolina/files/
                sc_willingness_
                finaloct032012.pdf

                d. Connect Minnesota, ``Worth the Cost: Broadband 
                Prices in Minnesota,'' http://www.connectmn.org/sites/
                default/files/connected-nation/Minnesota
                /files/mn_price_barriers_final.pdf

        B. Location (Rural vs. Non-rural)

        Location has consistently been a factor in broadband adoption 
        rates in states and localities where Connected Nation has 
        conducted research. Simply put, broadband adoption rates are 
        lower in rural areas of the United States, a problem compounded 
        by more extensive broadband availability challenges. Detailed 
        and state specific research results are available in the 
        documents below:

                a. Connected Texas, ``The Texas Digital Divide: An 
                Assessment of Rural and Non-Rural Texans,'' http://
                www.connectedtx.org/sites/default/files/connected-
                nation/Texas/files/tx_rural_non_rural_final.pdf

                b. Connect South Carolina, ``Technology Adoption among 
                Agribusiness and Rural Businesses,'' http://
                www.connectsc.org/sites/default/files/connected-nation/
                South%20Carolina/files/
                sc_agribusiness_final_dec172012.pdf

                c. Connect Nevada, ``Technology Use among Rural Nevada 
                Businesses,'' http://www.connectnv.org/sites/default/
                files/connected-nation/Nevada/files/
                nv_rural_biz_final.pdf

        C. Digital Literacy and Education

        Because relevance is such a significant barrier to broadband 
        adoption, Connected Nation's programs have produced state-
        specific research papers to help those state-based public 
        private partnerships craft appropriate strategies to spur 
        broadband adoption:

                a. Education

                        i. Connect South Carolina, ``Broadband--A 
                        Technology Tool for Lifelong Learning,'' http:/
                        /www.connectsc.org/sites/default/files/
                        connected-nation/South%20Carolina/files/
                        sc_adoption_sept2012_final.pdf

                        ii. Connected Texas, ``Providing Learning 
                        Anywhere: K-12 Education in Texas,'' http://
                        www.connectedtx.org/sites/default/files/
                        connected-nation/Texas/files/tx_elearning.pdf

                        iii. Connect Nevada, ``The Power of Broadband: 
                        Boosting Nevada's Education System,'' http://
                        www.connectnv.org/sites/default/files/
                        connected-nation/Nevada/files/
                        nv_elearning_final.pdf

                b. Digital Literacy

                        i Connected Texas, ``Making the Connection 
                        through Digital Literacy,'' http://
                        www.connectedtx.org/sites/default/files/
                        connected-nation/Texas/files/
                        tx_digital_literacy_final.pdf

                        ii. AConnect Minnesota, ``Digital Literacy: A 
                        Critical Skills for All Minnesotans,'' http://
                        www.connectmn.org/sites/default/files/
                        connected-nation/Minnesota/files/
                        mn_digital_literacy_final.pdf

        D. Demographics

                As shown in Figure 2, at-risk demographic groups adopt 
                broadband at lower than average rates, and as a result 
                Connected Nation's programs continue to explore this 
                area of concern:

                        a. Connect South Carolina, ``Closing the 
                        Digital Divide in South Carolina,'' http://
                        www.connectsc.org/sites/default/files/
                        connected-nation/South%20Carolina/files/
                        sc_gap_analysis_final.pdf

                        b. Connect Nevada, ``Technology Adoption among 
                        Hispanics in Nevada,'' http://
                        www.connectnv.org/sites/default/files/
                        connected-nation/Neva
                        da/files/nv_hispanic_adoption.pdf
IV. Conclusion
    Broadband technology is becoming pervasive in American life, and 
digital skills are rapidly becoming ``must have'' tools for American 
workers and students. Whether students can research and complete their 
homework, whether adults can improve their skills, whether a mother can 
shop for health insurance options online, whether a senior can see his 
or her own medical records and understand his or her care and 
prescriptions efficiently--all of these require wide adoption and broad 
knowledge as to how to use broadband. Broadband is not a luxury item, 
and this nation can ill-afford to have 3 in 10 adults remain off-line 
for very much longer.
    The gaps demonstrate the need for Federal leadership and support 
for public-private partnerships that will increase broadband adoption 
and use. Programs that can drive broadband adoption represent a highly 
efficient use of taxpayer funds because data show that once someone 
begins using broadband, they tend to keep it, thus driving economic 
impact for their community. For example, an April 2009 survey by the 
Pew Foundation's Internet Project reported that people are twice as 
likely to sacrifice cell-phone service or cable television service than 
Internet service, with 22 percent of adults reporting that they had 
cancelled or cut back cable TV service in the previous 12 months, 22 
percent of adults reporting that they have cancelled or cut back cell-
phone service in the previous 12 months, compared to only 9 percent of 
Internet users reporting cancelling or cutting back on broadband.\3\
---------------------------------------------------------------------------
    \3\ (http://www.pewinternet.org/Press-Releases/2009/Home-broadband-
adoption-increases-sharply-in-2009.aspx)
---------------------------------------------------------------------------
    Public-private partnerships, such as those that Connected Nation 
works to foster, have proven themselves as an effective vehicle for 
improving broadband availability and adoption. Successful public-
private partnerships will recruit local leaders, such as public 
libraries, school administrators, and public officials, behind 
initiatives to develop locally-relevant broadband applications and 
solutions that target the specific needs of each community. Converting 
non-adopters requires more than simply ``broadband cheerleading'' or 
splashy awareness raising campaigns- it frequently requires 
demonstrating directly to the community how broadband will improve 
quality of life and provide wealth-creating opportunities.
    At Connected Nation, we have had the privilege to see firsthand the 
positive outcomes of collaboration and public-private partnerships in 
this arena, and never cease to be amazed at what is possible when a 
community and individuals have the desire and opportunity to connect 
and access transformative broadband technology.
    Nonprofit organizations such as my own and fellow travelers such as 
the Blandin Foundation in Minnesota, the Prima Civitas Foundation in 
Michigan, and ITology in South Carolina have an important role to play 
working with both public and private sector stakeholders to foster and 
facilitate localized strategies for broadband expansion. It is 
imperative that as a nation we focus on programs that have a proven 
record of success working with local communities to identify and 
address the challenges that each community is experiencing. We look 
forward to continue working with Congress, the Federal government, 
states, and thousands of local champions who understand and share our 
mission for universal digital inclusion across America.
    Thank you again, Chairman Pryor, Full Committee Chairman 
Rockefeller, Ranking Member Wicker, and Members of the Subcommittee for 
this opportunity to provide this testimony for the record, and 
Connected Nation stands ready to continue working with you on this and 
other broadband related issues and policies.

    Senator Wicker. I think it has been a great hearing----
    Senator Pryor. Thank you.
    Senator Wicker.--Mr. Chairman. Appreciate it.
    Senator Pryor. I do have one last question, for Mr. Smith.
    Do you have any other questions, Senator Ayotte?
    Senator Ayotte. I don't think so.
    Senator Pryor. OK.
    I do have one last question, for Mr. Smith. I don't want 
you to feel left out of this----
    Mr. Smith. I was going to say, I thought you forgot about 
me over here.
    [Laughter.]
    Senator Pryor. No, no. I'll tell you, we appreciate Pew, 
because you guys do great work----
    Mr. Smith. Thank you.
    Senator Pryor.--and you provide a lot of good information 
and data, and just a great resource for us. So, I do want to 
mention that and thank you.
    Part of your testimony was, you mentioned that there's a 
slowdown in adoption in recent years. And I'd like to get your 
insight on that. And you mentioned some of this before, but I'm 
wondering if it's kind of a saturation issue that, sort of, the 
people who want it have already gotten it, and things like 
that. You went through some demographics, you know, older 
adults, low education, et cetera, that seemed to be resistant 
to taking this, for one reason or another. So, I'm curious 
about that, but I'm also curious about your reasons that you 
think that it's more difficult in rural areas to get the 
adoption rate where we want it to be. So, are we hitting a 
saturation point? And then, tell us specifically about rural 
America.
    Mr. Smith. Sure. So, in terms of a saturation point, I 
don't know that we've necessarily hit a saturation point, but 
it's pretty clear that the people who are easy converts have 
already converted, and the folks who are left over, you know, a 
lot of them, as I mentioned, don't use the Internet at all. So, 
not only do they, you know, not have broadband, they don't have 
a computer, they probably have very little experience with what 
they need to do and feel a lot of apprehension about going 
online. So, there's that group that obviously has some severe 
issues as far as that goes.
    The other group, a lot of those folks, generally, what we 
see and what the FCC has seen in their work is that they want 
it, they like the idea of access, they see the benefit of it, 
but, for various reasons, a lot of them financial, don't have 
the ability to have broadband at home.
    And I was going to mention to Senator Rubio, a significant 
number of those folks, so about 10 percent of the population 
now, we find doesn't have broadband at home but does have a 
smartphone. So, in many instances, that group is getting access 
of one kind or another through a smartphone, but not 
necessarily through a home connection.
    But, I think, you know, in addition to the--sort of, the 
economic climate that we've had recently, a lot of the issue is 
just that the folks who are left in the pool are not going to 
be as easy to bring on board as the folks that have already 
been brought on board, thus far.
    So, as to the rural question, definitely we see continued 
gaps in rural residents versus urban and suburban. That gap has 
gotten smaller over the years. And there are sort of two issues 
that go into play there. Part of that is--as Senator Ayotte 
mentioned, an access issue for certain rural areas. In a lot of 
sort of rural areas, you simply can't get access in a 
reasonable way. It also plays into the--the sort of 
demographics of the rural population. So, in general, they tend 
to be older, for example, and we know that the biggest group of 
non-adopters is people over the age of 65. So, there's sort of 
a demographic issue as well as an access or deployment issue 
when it comes to the rural population.
    Senator Pryor. OK. Well, thank you.
    And--you good?
    Senator Wicker. Yes.
    Senator Pryor. OK.
    Listen, thank you all for being here. I appreciate all of 
our panelists. I know some people need to travel back to where 
they came from. So, again, thank you.
    What we're going to do is, we'll leave the record open. 
Some of our members couldn't make it here today, and we will 
leave the record open for 2 weeks and allow members to submit 
questions. We would ask you all to get those back to us as 
quickly as you could.
    But, again, I just want to say thank you all for doing 
this. This is helpful, and we appreciate it.
    And, with that, we'll conclude the hearing.
    [Whereupon, at 12 p.m., the hearing was adjourned.]

                            A P P E N D I X

 Prepared Statement of Hon. John D. (Jay) Rockefeller IV, U.S. Senator 
  from West Virginia and Chairman, U.S. Senate Committee on Commerce, 
                      Science, and Transportation

    Over the last decade, the Nation has made great strides toward the 
goal of ubiquitous broadband availability around the Nation. While much 
work must be done in deploying broadband to the approximately 19 
million Americans that still lack access to broadband, the increase in 
broadband availability during the past 10 years is something to 
applaud. This achievement came through a concerted effort by both the 
public and private sectors, with billions of dollars in investment to 
bring the benefits of broadband to all Americans. [And I am proud of 
the role the Broadband Technology Opportunities Program (BTOP) that I 
championed has played in this effort toward achieving universal 
broadband availability and adoption.]
    Broadband empowers our people with the digital resources they need 
to succeed in their communities, across the Nation, and around the 
world. Broadband offers businesses, no matter their size, entry into 
the world's markets. It provides job seekers access to new 
opportunities to find employment. Broadband offers access to previously 
unavailable educational and health care resources. As I have seen in my 
travels around West Virginia, bringing broadband to citizens in 
unserved areas of the country can fundamentally change their lives.
    Making broadband available to all Americans, however, is only part 
of the challenge. That is why I am pleased that Subcommittee Chairman 
Pryor has convened today's hearing on broadband adoption. According to 
the National Telecommunications and Information Administration (NTIA)'s 
most recent report, approximately 27.8 percent of homes in America that 
have access to broadband do not subscribe to that service. The reasons 
for not subscribing can be varied, but the truth is that these homes 
risk being left behind as everyone around them takes advantage of the 
digital revolution brought about through broadband infrastructure.
    I am particularly interested in hearing witnesses discuss how 
broadband access by our students can positively impact large broadband 
adoption issues. Evidence from the Census Bureau shows a positive 
relationship between a child's exposure to broadband at school and 
adoption of broadband by the child's parents at home. Children are 
broadband advocates--as the world is opened up to them through the use 
of broadband and digital technology in the classroom, their parents and 
caregivers come to understand just how important it is to have 
broadband at home. This is yet another reason why the Federal 
Communications Commission must act quickly to strengthen and expand the 
E-Rate program in our Nation's classrooms and libraries.
    I want to thank our witnesses today and look forward hearing about 
their real-world experiences with broadband adoption efforts and the 
lessons learned from the field.
                                 ______
                                 
  Follow-up Submission to Testimony Submitted by Sunne Wright McPeak, 
         President and CEO, California Emerging Technology Fund
Purpose and Focus of Follow-Up Submission to Testimony

    The purpose of this document is to provide additional information 
and clarification regarding the written testimony submitted by the 
California Emerging Technology Fund (CETF) and responses to questions 
for the Senate Subcommittee on Communications, Technology and the 
Internet hearing on ``Broadband Adoption: The Next Mile'' on October 
29, 2013. This document addresses three major issues discussed during 
the hearing:

    Challenges of Increasing Broadband Adoption

    Policy Goals, Performance-Based Regulatory Framework, and 
        Incentives for Partnerships

    Community Experiences with Industry Broadband Adoption 
        Programs

Challenges of Increasing Broadband Adoption
    Chairman Pryor and Ranking Member Wicker both eloquently described 
in their opening comments the challenges of increasing broadband 
adoption which must be addressed by formulating national policy and 
designing an effective strategy to close the Digital Divide. Those who 
remain off-line are largely remote rural residents without access and 
urban poor residents without digital literacy skills or the resources 
to afford market rate Internet service. (The data published by the Pew 
Charitable Trust regarding broadband adoption are discussed below.) 
Clearly, broadband access (infrastructure deployment) is ``necessary'' 
for broadband adoption, but it is not ``sufficient'' for the most 
disadvantaged residents--low income families and people with 
disabilities. And, it is for these residents that broadband has the 
greatest potential to transform their lives and help them become 
productive citizens and contributing taxpayers for the benefit of the 
Nation.
    CETF summarized the challenges of broadband adoption in the written 
testimony based on extensive experience working with more than 80 
community-based organizations (CBOs) in disadvantaged communities 
throughout California. Dr. John Horrigan summarizes the challenges as 
three-fold, which were set forth in the CETF testimony:

  1.  Cost

  2.  Relevance

  3.  Digital Literacy

    CETF recommendations for action are anchored in the understanding 
that all three facets of the challenge must be addressed simultaneously 
in an integrated strategy to increase broadband adoption:

   There must be an affordable broadband subscription rate to 
        address the cost challenge. Given the modest market penetration 
        to date of voluntary efforts, it is likely that an Affordable 
        Broadband Lifeline Rate Program at the national level will be 
        pivotal to significantly increasing broadband adoption beyond 
        current levels.

   Broadband adoption should be integrated into all existing 
        Federal programs to address the relevance challenge. It should 
        be a part of all existing and future programs related to 
        education, workforce preparation, healthcare, and housing, 
        especially for disadvantaged and low-income populations. And, 
        that policy directive from Congress to integrate broadband 
        adoption does not require additional funding.

   Training in digital literacy with access to affordable 
        computing devices needs to be provided by CBOs with a positive 
        track record that can serve as the ``trusted messengers and 
        honest brokers'' in a way that broadband companies alone are 
        not able to do. And, digital literacy training is most 
        effective when integrated into relevant services.

    The Pew Charitable Trust data on broadband adoption needs to be 
interpreted through the ``lens of reality'' of on-the-ground experience 
with the benefit of listening to disadvantaged residents. Several focus 
groups commissioned by CETF with low-income people who don't subscribe 
to broadband and who don't have a computer in the home (all conducted 
in language and in culture) reveal that the vast majority of residents 
currently off-line want to have the benefits of high-speed Internet 
access (which generically is referred to as broadband and includes both 
wireline and wireless technologies).
    The 2013 Pew Report on ``Who's Not Online and Why'' finds that 85 
percent of Americans do use e-mail and the Internet overall, which 
tracks with an 86 percent Internet use rate in California, and that 15 
percent are not online overall, with just 5 percent saying that ``the 
Internet is not relevant to them''. Unfortunately, some industry voices 
repeat those figures as ``34 percent of the 15 percent'' (emphasizing 
the 34 percent in graphics) without doing the math to place in 
perspective that it is just 5 percent. Further, when anyone drills down 
on the 5 percent there is a discovery that many of these people are 
senior citizens who come to see the ``relevance'' when it is related to 
better healthcare monitoring in their home, which can offset follow-up 
clinical visits by as much as 40 percent (having a significant impact 
on quality as well as cost savings in healthcare). The majority of 
those not online, 58 percent of the 15 percent (or 9 percent of the 
population) cite digital literacy, lack of a computing device to 
connect to the Internet, and cost as issues. Thus, the Pew data confirm 
that increasing broadband adoption requires an integrated approach that 
tackles in a coherent strategy the three challenges of cost, relevance, 
and digital literacy.
    Broadband adoption, however, is not just about increasing overall 
Internet use--it is about high-speed Internet access and use at home. 
That is the focus of the California goal to achieve at least 80 percent 
broadband adoption at home (with no single region or demographic group 
less than 70 percent). California today is at 75 percent home broadband 
adoption (including 6 percent mobile devices only) and is not likely to 
achieve the 80 percent goal without new Federal policy and reform of 
the Universal Services Fund (USF) by the Federal Communications 
Commission (FCC) that address all three challenges to broadband 
adoption.
    While these figures may suggest that there are just a few 
percentage points left to close the Digital Divide, it must be 
understood that they translate into lots of real people who are being 
left farther and farther behind in a Digital World--more than 633,000 
families alone in California need to be reached to subscribe to 
broadband to achieve the 80 percent adoption goal.
    Pew contends that a relatively small percentage of Americans lack 
any access. However, in every state there are rural communities--
thousands and thousands across the county--that are being stifled 
without broadband access. Further, the infrastructure that does exist 
in many rural areas often is so slow as to be barely classified 
technically as ``broadband'' and certainly is inadequate for a vibrant 
21st Century community. And, while percentages may seem small, the 
actual number of households totally unserved (and woefully underserved) 
need to be put in perspective: in California, there are at least 
225,000 remaining unserved households to reach with broadband to 
achieve the state goal of 98 percent deployment. Fortunately, when 
broadband adoption is coordinated with deployment in California rural 
communities, then rural adoption rates quickly catch up to the 
statewide average.
    In the written testimony, CETF delineated specific recommendations 
for the integration of broadband deployment and adoption into existing 
programs within Federal departments. The U.S. Department of 
Transportation should have been included because deployment of 
broadband along with major Federal transportation projects (surface and 
transit) in public rights-of-ways (coupled with a ``Dig Once'' policy) 
can greatly assist broadband deployment into unserved areas. Further, 
broadband is a ``green strategy'' because it enables ``virtual trips'' 
which reduce impacts on the environment and help relieve traffic 
congestion.

Policy Goals, Performance-Based Regulatory Framework, and Incentives 
        for Partnerships
    As Senator Wicker observed during the hearing, CETF strongly 
recommends that Congress set policy goals for broadband deployment and 
adoption along with a timetable and assignments of responsibility. 
Without a goal there is no accountability for performance. It is the 
first crucial step towards ``rolling up our sleeves'', as Senator 
Ayotte proposed. In fact, a goal is the bedrock of a ``performance-
based'' regulatory framework that invites and rewards private-sector 
innovation versus the conventional ``command-and control'' regulatory 
scheme that inhibits investment. However, the references during the 
hearing to a ``light touch'' in regulations cannot and should not mean 
the absence of either policy goals or performance accountability--the 
very foundation for common sense regulations that serve the public 
interest while embracing the strengths of the private sector. That is 
why it is important for Congress to set national broadband deployment 
and adoption goals, as Senator Rubio questioned the witness panel.
    In this context, it is important to clarify my answer to Senator 
Klobuchar regarding ``mandates'' which in the CETF testimony refers to 
recommended actions by Congress to: (a) set policy goals for broadband 
deployment and adoption; (b) direct Federal departments to integrate 
broadband deployment and adoption into existing programs; and (c) 
provide input to the FCC on USF reform (including design of an 
Affordable Broadband Lifeline Rate Program and modernization of E-
rate). To the extent that Congress acts to establish Federal policy, 
then that is a ``mandate'' for the Administration.
    For example, CETF repeatedly recommended that Congress encourage 
and reward partnerships in meeting the broadband adoption goals--
federal-state, public-private, and provider-community. Thus, in this 
sense, CETF recommends that Congress ``mandate'' the FCC to reform the 
USF to provide incentives for partnerships to broadband providers such 
that design of an Affordable Broadband Lifeline Rate Program and E-rate 
reform addresses all three challenges to adoption: cost, relevance, and 
digital literacy. Likewise, CETF recommends that broadband providers 
that receive subsidies from USF should be required to submit a 
transparent plan to the FCC with goals (including percentage of 
eligible participants to be reached) and a coherent set of activities 
to achieve the goals. Further, CETF recommends that priority funding 
and/or financial incentives be available to those broadband providers 
that submit a plan to partner with intermediaries (such as EveryoneOn) 
and CBOs with proven track records as ``trusted messengers and honest 
brokers'' and which incorporates relevance and digital literacy. While 
it would be voluntary on the part of each provider whether or not to 
participate in the Affordable Broadband Lifeline Rate Program, receipt 
of USF subsidies would be accompanied by these kinds of 
``requirements''--which some might call a ``mandate''--but which are 
needed to ensure accountability and success.

Community Experience with Industry Broadband Adoption Programs
    CETF strongly encourages public-private partnerships to leverage 
public investment and harness the innovation of the private sector. 
Such partnerships must be transparent, explicit about goals, and 
accountable for results. As stated during the hearing, CETF commends 
industry efforts, such as Comcast Internet Essentials (CIE) program, 
but observes that the results to date have been modest, with less than 
10 percent of the eligible households actually participating. It is 
worth noting that Comcast executive David Cohen did clarify at a 
Washington Post forum last week (November 5, 2013) that his reference 
during the hearing to ``1 million Americans'' participating in CIE was 
a calculated projection of all persons in about 250,000 households that 
actually have signed up. In California, 25,739 households out of 
313,805 eligible households, or only 8.2 percent of the prospective 
market, have signed up for CIE (according the last public release by 
Comcast on June 21, 2013). Other companies have done even less: 
according to EveryoneOn, Time Warner Cable operated their affordable 
broadband pilot for only 2 months (although the launch was highly-
touted in media) and signed up just 1,235 households around 502 
participating disadvantaged schools. To be sure, these companies know 
how to market and are successful when they are committed to a goal. 
They have not produced the hoped-for results because they have not been 
accountable to anyone for performance, have ignored the ``lessons 
learned'' from on-theground experience, and have invested too little in 
partnering with CBOs with a track record to integrate relevance and 
digital literacy into their broadband adoption programs.
    Attached are letters from knowledgeable sources close to the 
community and consumer realities of these voluntary affordable 
broadband adoption programs that set forth the nature of the existing 
problems. Representatives in California of Comcast and other companies 
have been open to receiving this kind of input and have tried to 
respond to the extent of their authority; and some issues have been 
resolved, but enough problems persist to conclude that there must be 
substantive changes to the programs to increase market penetration and 
broadband adoption.

Conclusion
    Closing the Digital Divide is an imperative for U.S. global 
competitiveness. The Senate Subcommittee hearing was a very good 
beginning to identify the challenges and formulate strategies to 
accelerate broadband adoption. It is essential that Congress act to 
establish policy goals that leverage existing resources, foster 
partnerships, and reward results. There is no substitute for 
Congressional leadership to empower and mobilize the Nation's 
imagination, talent and innovation.
    As was repeatedly said during the hearing, ``there is no silver 
bullet'' for broadband adoption, but as was stated in the CETF written 
testimony, ``there is silver buckshot'' in that there is a ``critical 
mass'' of actions required close the Digital Divide which must be 
infused in Federal policy. As was discussed during the hearing, there 
are well-known, documented primary challenges to broadband adoption:

  1.  Cost

  2.  Relevance

  3.  Digital Literacy

    Closing the Digital Divide and accelerating broadband adoption 
requires an affordable broadband rate for low-income families. As FCC 
Commission Mignon Clyburn has observed, ``100 million American homes 
are without broadband and the #1 reason is affordability.'' Thus, there 
is a need to step up the voluntary efforts by broadband providers and 
establish a Federal Affordable Broadband Lifeline Rate Program that is 
coupled with incentives for partnerships to integrate broadband into 
other relevant programs for disadvantaged residents that incorporate 
digital literacy training.
    As a result of the Senate Subcommittee hearing, the Senators should 
take heart that it is entirely possible to succeed in closing the 
Digital Divide. Congressional leadership, focus and commitment make a 
huge difference in this quest.
Attachments

Letters from:

  --2-1-1/United Ways of California, Los Angeles

  --Chicana/Latina Foundation, Burlingame

  --Mission Economic Development Agency, San Francisco

  --Office of Community & Economic Development, California State 
        University, Fresno

  --Santee Educational Complex, Los Angeles Unified School District, 
        Los Angeles
                                 ______
                                 
Attachments to Letter

                                           2-1-1 California
                              South Pasadena, CA, November 11, 2013

Hon. Mark Pryor,
Chairman, Subcommittee Committee on Communications, Technology, and the 
Internet,
United States Senate
Washington, DC.

Hon. Roger Wicker,
Ranking Member, Subcommittee Committee on Communications, Technology, 
and the Internet,
United States Senate
Washington, DC.

           Re: Hearing on Broadband Adoption: The Next Mile

Dear Chairman Pryor and Ranking Member Wicker:

    My name is Lilian P. Coral, and I serve as the Director of 2-1-1 
California. Under the fiscal sponsorship of the United Ways of 
California, 2-1-1 California is a statewide network of local 2-1-1 
information and referral providers authorized by the California Public 
Utilities Commission and the Federal Communications Commission to use 
the 2-1-1 code as an easy-to-remember and universally recognizable 
number that would enable a critical connection between individuals and 
families in need and the appropriate community-based organizations and 
government agencies. 2-1-1 California's mission is to develop the 
statewide infrastructure and support necessary to ensure quality 2-1-1 
services for everyone. In California, 2-1-1 is accessible in 30 
counties servicing 93 percent of Californians.
    I am writing this letter to add additional information to the 
record for the Broadband Adoption: The Next Mile hearing. We were 
fortunate to be recipients of an American Recovery and Reinvestment Act 
grant through the National Telecommunications and Information 
Administration to focus on Broadband Awareness and Adoption and between 
March 2010 and June 2013 2-1-1 California through its 2-1-1 partners:

   Provided outreach and education to 229,481 callers

   Screened and referred 59,775 callers to computer and 
        Internet-related resources

    As follow-up, 2-1-1 California through its 2-1-1 partners, 
conducted surveys and interviews with approximately 6 percent of these 
callers to find out whether they had participated in any computer/
Internet related training classes, subscribed to broadband or received 
a free or low cost computer as a result of the referrals they received 
from 2-1-1. Based on the survey results, we estimate that:

   7,478 households subscribed to broadband

   4,318 adults participated in a training class

   3,659 households received a computer

   4,555 children were connected to the Internet

    Unfortunately, the Digital Divide continues to disproportionally 
impact thousands of low-income families throughout California and 
especially in some of our major urban centers. Based on in-depth 
screening and referral protocols, callers told 2-1-1 Specialists that 
the main reason they did not have broadband at home was that they did 
not own a computer (41 percent). The second biggest reason was cost (36 
percent).
    We believe broadband adoption is an imperative for economic 
prosperity, quality of life and family self-sufficiency and support the 
recommendations put forth by the California Emerging Technology Fund 
for accelerating Broadband adoption. Our Data and experience indicate 
that the majority of people without broadband at home do want to adopt 
the technology and understand the value proposition.
    We think it is particularly important that there be stronger 
partnerships that can help community-based organizations like our own, 
who are trusted messengers, connect those still unconnected to truly 
affordable broadband options that will ensure low-income families 
connect, and stay connected, to broadband, to access the richness of 
resources and education that the Internet affords.
            Respectfully,
                                           Lilian P. Coral,
                                                          Director,
                                                      2-1-1 California.
                                 ______
                                 
                                  Chicana/Latina Foundation
                                   Burlingame, CA, November 8, 2013

Hon. Mark Pryor,
Chairman, Subcommittee Committee on Communications, Technology, and the 
Internet,
United States Senate,
Washington, DC.

Hon. Roger Wicker,
Ranking Member, Subcommittee Committee on Communications, Technology, 
and the Internet,
United States Senate,
Washington, DC.

           Re: Hearing on Broadband Adoption: The Next Mile

Dear Chairman Pryor and Ranking Member Wicker:

    My name is Alicia Orozco, and I serve as Project Manager of the Get 
Latinos Connected project (GLC) of the Chicana Latina Foundation, based 
in the San Francisco Bay Area. The GLC project seeks to end the digital 
divide that keeps the Latino community from connecting to the Internet, 
and thus fully participating in the 21st Century. We are a non-profit 
organization which promotes professional and leadership development of 
Latinas. The Foundation's mission is to empower Chicanas/Latinas 
through personal, educational, and professional advancement.
    I am writing this letter to add additional information to the 
record for Broadband Adoption: The Next Mile hearing. We were fortunate 
to be recipients of an American Recovery and Reinvestment Act grant 
through the National Telecommunications and Information Administration 
to focus on Broadband Awareness and Adoption. With that project, were 
able to sign up 1,070 first-time Internet users. That is 1,070 new 
Latino Internet users. The majority of these homes have children who 
now enjoy access to the online world and who have improved their class 
work.
    We strongly advocate for broadband at home and Digital Literacy 
training as described in the National Broadband Plan, and we are making 
the suggestions described in this letter with the goal of giving all 
Americans access to digital tools and skills to improve their lives.
    While we find the Comcast Internet Essentials program to be helpful 
to some Bay Area families, there are several barriers that impede many 
more households from participating.
    We recommend that:

    Comcast extend its program from 2014 until 2017 and set adoption 
goals. As Comcast Executive Vice President David Cohen testified before 
your subcommittee, the company has ``learned a lot over the first two 
years'' of the three-year program. Currently, Internet Essentials is 
scheduled to end 1 June 2014. From a California perspective, where 
nearly half of Latino households do not have access to high-speed 
Internet at home, this is not the time to halt the program. Comcast is 
the main cable provider in the San Francisco Bay Area. We also 
recommend that Comcast set national adoption targets as a percentage of 
eligible households, and similar targets in major markets, such as the 
San Francisco Bay Area. In addition to disclosing adoption goals, it 
would be very helpful for non-profits like ours if Comcast would share 
information about where they are targeting the broadband offer, 
including providing lists of schools where students are eligible for 
Comcast Internet Essentials. We have been asking for the list of auto-
qualified schools since the program started and we're still waiting for 
that list.
    The online application is useless. We have yet to be able to 
actually use it. We've held Technology Fairs where we have set up 
computer banks so that they can actually sign up people for Internet 
Essentials, but have been unable to because the online application does 
not work. We keep getting bounced off.
    We also have become aware of the fact that when a person calls 
Comcast to sign up for Internet Essentials, they are being asked how 
many children they have in the program. Then the Comcast agent chooses 
the oldest child to enroll in the program. This means the family will 
be ``kicked out'' of the program sooner, because the discount only 
lasts as long as the child is in school. So if an eligible family has a 
child in high school and another in elementary schools (both on the 
National Lunch program) by enrolling the high school student, the 
family loses several years of eligibility for Internet Essentials.
    Comcast remove the 90-day requirement. Comcast will not allow low-
income families who are already Internet subscribers, or have 
subscribed in the past 90 days, to switch to the cheaper Internet 
Essentials service. If a family has subscribed to the Internet as part 
of a Comcast bundled service, they must stop service for 90 days before 
they become eligible for the $9.95 month Internet service.
    Comcast increase support of local and regional digital literacy 
programs. Many of the families we serve need computer literacy training 
to take full advantages of their broadband connections. CLF has worked 
effectively with schools, faith-based communities, local employers, 
health clinics and job-training programs to incorporate digital 
literacy and workforce training. We would welcome additional 
commitments by Comcast to help fund essential training programs like 
these.
    Comcast increase support of local and regional digital literacy 
programs. Many of the families we serve need computer literacy training 
to take full advantage of their broadband connections to the Internet. 
The Chicana/Latina Foundation has worked effectively with schools, 
churches, health clinics, job-training programs and social service 
providers to incorporate digital literacy and workforce training. We 
would welcome additional commitments by Comcast to help fund essential 
training programs like these.
    Comcast expand the program to include low-income seniors, people 
with disabilities and veterans. Recent polling on home broadband use in 
California shows that seniors and people with disabilities adopt high-
speed home Internet at significantly lower rates than other 
populations. Often homebound, these clients are among the most 
vulnerable we serve, and an affordable Internet connection would 
significantly improve their access to vital services and the quality of 
their lives.
    Elected officials and policymakers should know that while Comcast 
has made improvements to its discounted broadband offer, the company 
should make Internet Essentials available beyond June 2014 and expand 
eligibility as described above if it desires to be a leader in closing 
the Digital Divide in California.
            Respectfully,
                                             Alicia Orozco,
                                                   Project Manager,
                                                 Get Latinos Connected.
                                 ______
                                 
                        Mission Economic Development Agency
                                                  San Francisco, CA

Hon. Mark Pryor,
Chairman, Subcommittee Committee on Communications, Technology, and the 
Internet,
United States Senate,
Washington, DC.

Hon. Roger Wicker,
Ranking Member, Subcommittee Committee on Communications, Technology, 
and the Internet,
United States Senate,
Washington, DC.

           Re: Hearing on Broadband Adoption: The Next Mile

    My name is Luis Granados, and I serve as Executive Director of the 
Mission Economic Development Agency (MEDA), based in San Francisco. The 
Mission Economic Development Agency (MEDA) is a community-based, local 
economic development corporation located in the Mission District of San 
Francisco. For 40 years MEDA has worked to improve economic and social 
conditions in the neighborhood by stimulating investment, enhancing the 
business environment, and creating jobs for area residents, with an 
emphasis on the Latino community in San Francisco. MEDA engages the 
local community with homeownership counseling, foreclosure 
intervention, small business development services, financial education, 
free tax preparation, and technology training and workforce 
development.
    I am writing this letter on behalf of MEDA to add additional 
information to the record for the Broadband Adoption: The Next Mile 
hearing. We were fortunate to be recipients of an American Recovery and 
Reinvestment Act grant through the National Telecommunications and 
Information Administration to focus on Access to Careers in Technology 
and, earlier this year the Department of Education granted MEDA a $30 
million Mission Promise Neighborhood Grant aimed at helping students at 
underperforming schools San Francisco.
    We strongly advocate for broadband at home and digital literacy 
training as described in the National Broadband Plan, and we are making 
the suggestions described in this letter with the goal of giving all 
Americans access to digital tools and skills to improve their lives.
    In our work with Comcast we have found the Internet Essentials 
program to offer high-quality, reliable broadband service to some of 
the people who need it most. Our clients who have subscribed are 
generally happy with the program. However, there are several barriers 
that impede many more households from participating.
    We recommend that Comcast take the following steps to ensure that 
the maximum amount of eligible and needy families can benefit from 
Internet Essentials:

    Extend Internet Essentials from 2014 until 2017. As Comcast 
Executive Vice President David Cohen testified recently before your 
subcommittee, the company has ``learned a lot over the first two 
years'' of the three-year program. Currently, Internet Essentials is 
scheduled to end in June 2014. From a California perspective, where 
nearly half of Latino households do not have high-speed Internet access 
at home, Comcast should continue the program.
    In addition, in the first years of the program Internet Essentials 
sign-ups were impacted as we worked with eligible families to overcome 
hurdles in the subscription process, challenges that resulted in 
damaged community confidence in the product. These hurdles included:

   Clients receiving letters from Comcast saying that they had 
        failed a credit check. Internet Essentials specifically 
        advertised there would be no credit check.

   The application process took up to 3 months--far too long 
        for clients that are skeptical about the product in the first 
        place and have other pressing demands on their budget.

   Initial Internet Essentials customer service representatives 
        suggested that Internet Essentials clients could pay $150 
        deposit to avoid a credit check.

   Families were charged $50 by the technicians that installed 
        their modem, even though Internet Essentials guarantees free 
        installation.

    Through advocacy with Comcast and the actions of regional staff, 
these issues have been addressed by Comcast. However, MEDA is concerned 
that these issues have prevented eligible and needy families from fully 
taking advantage of this benefit. Due to these early barriers MEDA 
believes Comcast should extend the Internet Essentials program until 
2017.
    Comcast increase support of community-based programs. If it weren't 
for community-based organizations helping clients learn about and 
subscribe to Internet Essentials, Comcast wouldn't even have the 8 
percent penetration it is currently reporting among eligible families. 
These organizations also provide critical ongoing support to 
subscribers, including digital literacy training. At MEDA, we spend 
significant resources on these support activities. We would welcome 
additional commitments by Comcast to help fund essential programs like 
these.
    Comcast expand the program to include low-income individuals. Even 
as government and other social services are more exclusively available 
online, the clients they are meant to serve adopt high-speed home 
Internet at significantly lower rates than other populations. Low-
income households, people with disabilities and seniors are among the 
most vulnerable we serve, and an affordable Internet connection would 
significantly improve their access to vital services and the quality of 
their lives.
    Elected officials and policymakers should know that while Comcast 
has made improvements to its discounted broadband offer, the company 
should offer Internet Essentials beyond June 2014 and expand 
eligibility as described above if it desires to truly play a leadership 
role in closing the Digital Divide and achievement gap in our state.
            Respectfully,
                                             Luis Granados.
                                 ______
                                 
                        California State University, Fresno
                                                         Fresno, CA

Hon. Mark Pryor,
Chairman, Subcommittee Committee on Communications, Technology, and the 
Internet,
United States Senate,
Washington, DC.

Hon. Roger Wicker,
Ranking Member, Subcommittee Committee on Communications, Technology, 
and the Internet,
United States Senate,
Washington, DC.

           Re: Hearing on Broadband Adoption: The Next Mile

Dear Chairman Pryor and Ranking Member Wicker:

    I am writing on behalf of the Office of Community and Economic 
Development (OCED) at California State University, Fresno (Fresno 
State). Through our community-based programs, we and our partners 
annually help thousands of San Joaquin Valley (Valley) residents gain 
access to services vital to their lives, including high-speed Internet 
at home.
    This letter is to provide input to the record for the Broadband 
Adoption: The Next Mile hearing. Specifically, we wish to comment on 
the disappointing experience we have had in trying to connect families 
to the Internet Essentials Program offered by Comcast. Also, we ask you 
to support this much-needed program by extending the program beyond the 
proposed June 2014 date.
    Comcast is one of the largest broadband providers for rural areas 
of the San Joaquin Valley, one of the poorest regions of California. 
When first introduced, we welcomed Internet Essentials as an 
opportunity to connect our traditionally un-served population. However, 
based on the substantial hurdles our residents face when signing up for 
Internet Essentials, we find ourselves reluctant to support the program 
due to the long wait before customers can begin using the Internet at 
home.
    The waiting period between the initial call to Internet Essentials 
and the application arriving in the mail is 8-12 weeks, if the letter 
comes at all. After submitting the application, another 2-4 weeks 
elapse before the equipment arrives. Many Valley residents do not have 
Social Security numbers and are therefore forced to drive long 
distances to verify identification since Comcast has closed many of its 
regional offices.
    Leaders in the San Joaquin Valley have been pushing for online 
registration since the beginning of the Internet Essentials Program. 
Despite what Comcast says, the system is not working properly. The site 
is often unable to complete address eligibility searches and simply 
redirects the customer to the 1-855 number again. We understand that 
new systems need time to work out the bugs, but we have been trying to 
work with Comcast for many weeks to provide consumer feedback about the 
poor website operations, to no avail.
    Comcast does not effectively advertise Internet Essentials in our 
area, so our community partners use grassroots educational campaigns to 
let families know about the program. Comcast also does not provide 
timely data to tell us which schools are undersubscribed for Internet 
Essentials so our partners can make best use of their resources to 
target un-served families for adoption.
    My greatest concern, with the program scheduled to end in June 
2014, is that the discounted offer will only be available for new 
enrollments for a few more months, leaving many Valley residents unable 
to take advantage of this opportunity to connect to broadband at home.
    Please consider the Office of Community and Economic Development at 
California State University, Fresno a supporter of extending the 
Internet Essentials Program.
    If you have any questions regarding our support of expanding the 
Internet Essentials Program please contact me at [email protected].
            Sincerely,
                                               Mike Dozier,
                                                Executive Director,
                                   California State University, Fresno.
                                 ______
                                 
                                   Santee Education Complex
                                                    Los Angeles, CA
Hon. Mark Pryor,
Chairman, Subcommittee Committee on Communications, Technology, and the 
Internet,
United States Senate,
Washington, DC.

Hon. Roger Wicker,
Ranking Member, Subcommittee Committee on Communications, Technology, 
and the Internet,
United States Senate,
Washington, DC.

           Re: Hearing on Broadband Adoption: The Next Mile

    My name is Martin O. Gomez and I serve as Principal at Santee 
Education Complex based in Los Angeles. We serve 1,850 college bound 
students in the South L.A. community in which 100 percent of our 
students qualify for free and reduced lunch.
    I am writing this letter on behalf of Santee Education Complex and 
our community to add additional information to the record for the 
Broadband Adoption: The Next Mile hearing. Unfortunately, the Digital 
Divide continues to disproportionally impact thousands of low-income 
students attending Los Angeles schools. Last year, several of those 
schools located in some of the most economically challenged areas in 
Los Angeles were invited to participate in a pilot program sponsored by 
Time Warner Cable (TWC), which according to the company's own estimates 
serves one quarter of California households.
    With much national publicity, TWC announced that it would offer a 
low-cost broadband offer at $9.95 for families with students 
participating in the National School Lunch program at 19 Los Angeles-
area schools. This pilot was offered for only two months, from October 
1 until November 30, 2012, and without visible outreach by TWC to 
promote the program. Many of us had hoped that the two-month pilot 
would offer valuable lessons on the enrollment process and marketing 
and customer service, which then would allow TWC to scale up the 
program to reach all students in the National School Lunch program. In 
fact, the pilot turned out to be a very short ``limited time offer''. 
According to the California Emerging Technology Fund, TWC enrolled just 
1,200 families nationally in 500 schools.
    Even more disappointing, TWC did not offer any explanation as to 
why they stopped the discount program completely while other cable 
providers in California saw the value of helping low-income families 
subscribe to broadband at home.
    We think elected officials and policymakers should know that this 
is a missed opportunity for the largest cable provider in California to 
play a leadership role in closing the Digital Divide and achievement 
gap in our state.
            Respectfully,
                                   Martin O. Gormez, Ph.D.,
                                              Instructional Leader,
                                              Santee Education Complex.
                                 ______
                                 
      Prepared Statement of the National Hispanic Media Coalition
    To the Honorable Chairman Mark Pryor, Ranking Member Roger Wicker, 
and Members of the Subcommittee:

    The National Hispanic Media Coalition (``NHMC'') writes to 
supplement the record of the hearing held by the Senate Committee on 
Commerce, Science, and Transportation, Subcommittee on Communications, 
Technology, and the Internet entitled ``Broadband Adoption: The Next 
Mile'' on October 29, 2013. Thank you for providing me with the 
opportunity to submit this written testimony.
Slowing Adoption Rates, the Issue of Affordability, and the Cost of 
        Digital Exclusion
    While home broadband adoption rates have improved since broadband 
service was introduced, the adoption rate still lags among certain 
segments of the population--to include Latinos, African-Americans, 
seniors, struggling families, people with disabilities, and the less 
educated. Indeed, as Aaron Smith of the Pew Research Center's Internet 
Project pointed out during his testimony at the hearing, the pace of 
broadband adoption overall has ``slowed substantially'' in recent 
years.\1\
---------------------------------------------------------------------------
    \1\ Broadband Adoption: The Next Mile Before the Subcomm. On 
Commc'ns., Tech., and the Internet of the S. Comm. On Commerce, Sci., 
and Transp., 113th Cong. 1 (2013) (statement of Aaron Smith, Senior 
Researcher, Pew Research Center's Internet Project), available at 
http://www.commerce.senate.gov/public/?a=Files.Serve&File_id=8919d402-
a852-4246-916e-de623778
e7e5 (pointing out that ``[a]fter increasing by an average of nearly 
seven percentage points per year from 2000 through 2009, the national 
broadband adoption level increased by a total of just seven percentage 
points from 2009 through 2013.'').
---------------------------------------------------------------------------
    The Latino community, in particular, has struggled to adopt 
broadband at home. According to a recent Pew report, only 53 percent of 
Latinos have adopted broadband at home, meaning that almost half of 
Latinos remain disconnected.\2\ And those who prefer to speak Spanish 
at home have proven to be one of the most difficult groups to reach, 
with only 38 percent having broadband within the home.\3\
---------------------------------------------------------------------------
    \2\ Kathryn Zickuhr & Aaron Smith, Pew Internet and American Life 
Project, Home Broadband 2013 3 (2013), available at http://
www.pewinternet.org//media//Files/Reports/2013/
PIP_Broadband%202013_082613.pdf.
    \3\ Lee Rainie, Director, Pew Internet and American Life Project, 
Presentation at Washington Post Live 2013 Bridging the Digital Divide 
forum (Nov. 5, 2013), available at http://www.pewinternet.org/
Presentations/2013/Nov/The-State-of-Digital-Divides.aspx.
---------------------------------------------------------------------------
    Cost of service and relevance have been cited in a number of 
reports as reasons why many fail to adopt broadband, although it is 
important to note that a social desirability bias can exist in answers 
to survey questions about personal income and spending power. In other 
words, a respondent may point to relevance or lack of interest or 
necessity as a reason for failing to adopt broadband so that they do 
not have to admit to the surveyor that they cannot afford to pay the 
costs associated with service. Further, beyond this bias, there is an 
important relationship between cost and relevance that should not be 
overlooked. As Zach Leverenz, the Chief Executive Officer of 
EveryoneOn, a national non-profit working on bridging the digital 
divide, mentioned at a recent event, the issue of relevance can be 
problematic because ``people that can't afford [broadband] also think 
of it as being not relevant.'' \4\
---------------------------------------------------------------------------
    \4\ Video Clip: I came from the digital divide, Wash. Post Live, 
available at http://www.washingtonpost.com/postlive/conferences/
digital-divide.
---------------------------------------------------------------------------
    The failure to adopt broadband at home will serve to exacerbate 
existing socio-economic disparities, putting Latinos and others who 
have failed to adopt broadband at a significant disadvantage. The 
Federal Communications Commission (``FCC'') Broadband Adoption 
Taskforce has defined the digital divide that exists between those that 
have broadband and those that do not, as an ``opportunity divide'' that 
manifests itself in a number of ways.\5\ For instance, more than 80 
percent of Fortune 500 companies, including huge employers like Wal-
Mart and Target, only accept job applications online.\6\ In the next 
decade, nearly 80 percent of jobs will require some digital literacy 
skills.\7\ And students with broadband at home graduate at a rate 6-8 
percent higher than students who lack such access.\8\ Consumers with 
broadband at home can save up to $7,000 per year on goods and services, 
and annual revenues of small businesses with broadband access are, on 
average, $200,000 higher than those without broadband.\9\
---------------------------------------------------------------------------
    \5\ FCC Broadband Adoption Taskforce, Broadband Adoption 
Presentation to FCC Open Meeting, at slide 4-5 (Nov. 30. 2011), 
available at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-
311281A1.pdf.
    \6\ Id. at slide 10.
    \7\ Id. at slide 11.
    \8\ Id. at slide 14.
    \9\ Id. at slide 19.
---------------------------------------------------------------------------
Industry and Government Each Have an Important Role to Play
    Private initiatives and public-private partnerships are a valiant 
effort to solve the problem of lagging home broadband adoption but, 
while valuable, some have significant limitations when it comes to 
trying to reach the remaining hold outs. For instance, many low-cost 
broadband programs require a household to have a student in the 
National School Lunch Program in order to be eligible to receive the 
reduced rate.\10\ However, this eligibility criterion targets a group 
that has outperformed others when it comes to home broadband adoption--
families with school-age children. According to a recent National 
Telecommunications and Information Administration (``NTIA'') report, 
households with school-age children are already adopting broadband at 
home at a rate of 79 percent. That rate is 13 percentage points higher 
than households without school-age children, which only adopted home 
broadband at a rate of 66 percent.\11\
---------------------------------------------------------------------------
    \10\ See e.g., How It Works--Comcast Internet Essentials, http://
www.internet
essentials.com/how-it-works.
    \11\ NTIA, U.S. Dept. of Commerce, Exploring the Digital Nation: 
America's Emerging Online Experience 26 (June 2013) available at http:/
/www.ntia.doc.gov/files/ntia/publications/
exploring_the_digital_nation_-_americas_emerging_online_experience.pdf.
---------------------------------------------------------------------------
    Government initiatives can subsidize the cost of service for a 
wider range of people, potentially creating a price point lower than 
that offered by Internet service providers, and collect important data 
associated with any efforts along the way. The Universal Service Fund 
already subsidizes the cost of broadband connections for schools and 
libraries through the E-Rate program, and the cost of basic phone 
service (or broadband bundled with phone service) for low-income 
households through the Lifeline program. Both programs have already 
demonstrated success at connecting underserved communities to valuable 
communications services. Further, the FCC has conducted a number of 
pilots to determine how it can best leverage existing programs to make 
broadband more affordable and accessible in the home and important data 
has been collected as a result.\12\ This data should be analyzed and 
released to the public. NHMC also agrees with the California Emerging 
Technology Fund (``CETF'') that any efforts should incorporate the 
``wealth of knowledge'' and the lessons learned by the NTIA through its 
administration of a number of broadband programs.\13\
---------------------------------------------------------------------------
    \12\ For instance, the FCC's Learning-On-The-Go pilot launched in 
2011 to test a program in which students were provided with devices and 
Internet access at home and in the school. The results of this pilot 
program have yet to be released. Further, the FCC is currently 
conducting Lifeline Broadband Pilot, to explore the variables 
associated with home broadband adoption in low-income households. Once 
completed, the data collected during this pilot must be analyzed. See 
Lifeline and Link Up Reform and Modernization, WC Docket No. 11-42, 
Order, 27 FCC Rcd. 15842 (rel. Dec. 19, 2012) available at http://
hraunfoss.fcc.gov/edocs_public/attachmatch/DA-12-2045A1.pdf.
    \13\ Broadband Adoption: The Next Mile Before the Subcomm. On 
Commc'ns., Tech., and the Internet of the S. Comm. On Commerce, Sci., 
and Transp., 113th Cong. 5 (2013) (statement of Sunne Wright McPeak, 
President and CEO, California Emerging Technology Fund), available at 
http://www.commerce.senate.gov/public/?a=Files.Serve&File_id=dae0b397-
babc-45b5-8751-2cd7622fbe11.
---------------------------------------------------------------------------
    Important lessons learned by other, public initiatives, such as 
those carried out by CETF, can also provide valuable insight into how 
any future, national programs should be structured for maximum 
efficacy. For instance, CETF's School2Home initiative is similar to 
some of the existing private initiatives in that community engagement 
happens at the school. However, by targeting low-performing middle 
schools and stressing parent engagement, the program was able to yield 
impressive broadband adoption results in hard to reach groups. 
According to CETF's testimony, the School2Home initiative increased 
home broadband adoption among Spanish-speaking parents from 48 percent 
to 76 percent--a dramatic increase within a group that has historically 
struggled with broadband adoption.\14\ By examining this type of 
success story and extracting lessons from it, we may have a real shot 
at significantly increasing home broadband adoption rates in lagging 
communities.
---------------------------------------------------------------------------
    \14\ Id. at 6.
---------------------------------------------------------------------------
    NHMC believes that spurring home broadband adoption will lead to 
greater equity in our society and allow historically disadvantaged 
communities to access opportunities that have been previously 
unattainable. It was encouraging to see the Subcommittee take up this 
issue and to see so many Members speak passionately about the 
importance of bridging the digital divide during the hearing. NHMC 
looks forward to remaining engaged on this important issue and welcomes 
any questions from the Subcommittee.
            Testimony Prepared By:
                                           Michael Scurato,
                                                   Policy Director,
                                     National Hispanic Media Coalition.
                                 ______
                                 
                 United States Hispanic Chamber of Commerce
                                                   October 29, 2013

Senator Mark Pryor,
Chairman,
U.S. Senate Subcommittee on Communications, Technology, and the 
Internet,
Washington, DC.

Senator Roger Wicker,
Ranking Member,
U.S. Senate Subcommittee on Communications, Technology, and the 
Internet,
Washington, DC.

Chairman Pryor and Ranking Member Wicker:

    I write today to thank the Subcommittee on Communications, 
Technology, and the Internet for its timely hearing entitled Broadband 
Adoption: The Next Mile to discuss the access and adoption of broadband 
in the United States. As the President and CEO of the United States 
Hispanic Chamber of Commerce (USHCC), I have had the unique opportunity 
to observe closely private industry's investment in closing the digital 
divide. I want to take this opportunity to highlight a few of the most 
innovative approaches, programs, and investments undertaken by the 
private sector to date.
    The National Telecommunications & Information Administration (NTIA) 
recently published a report entitled Exploring the Digital Nation: 
America's Emerging Online Experience, which identified those American 
communities most affected by the persistent technology gap. Among the 
communities identified were Hispanic families, who lagged significantly 
behind their White counterparts in computer ownership, Internet use, 
and broadband adoption. In fact, only 58 percent of Hispanic households 
surveyed were connected to the internet.
    What is particularly troubling about these adoption rates is that 
they persist in the face of near universal broadband access. Pro-
broadband efforts of the Obama Administration coupled with extensive 
and sustained investment from the private sector have pushed rates of 
broadband access to 98 percent. Today, the Internet has become an 
indispensable tool for educational exploration, social interaction, and 
entrepreneurial innovation. Broadband further extends opportunities in 
e-commerce, telecommuting, distance learning, and telemedicine. In the 
information age, still more need be done to ensure that the 
opportunities offered by the Internet are expanded to all Americans.
    The private sector has essential role to play, and has played an 
important role. Industry has contributed to the expansion of the 
Internet infrastructure, designed original programming to bolster 
broadband adoption rates among the public, partnered with other 
community institutions to demonstrate and broaden Internet 
applications, and continues to deliver faster speeds of access.
    AT&T is making an impressive investment in the infrastructure 
delivering high-speed Internet across the country. Just last year, AT&T 
announced that it would spend $14 billion over three years expanding 
its broadband service and high-speed wireless to the majority of its 
extensive landline network. This considerable contribution will broaden 
high-speed Internet access to some 8.5 million homes in some of the 
most difficult to reach communities around the country.
    Comcast has instituted an important program in closing the digital 
divide. Its Internet Essentials program provides discounted broadband 
rates to lower-income households, as well as access to low-cost 
computers and digital training. Over one million American households--
often connecting to the Internet from their home for the first time--
have been served by this pioneering program to date.
    Verizon has been at the fore of demonstrating the innovative 
applications of broadband in daily life. Verizon's Innovative Learning 
School Program has provided comprehensive training to hundreds of 
teachers in the utilization and leveraging of online technology in STEM 
focused classrooms. This has delivered the benefits of broadband to 
thousands of students in lower-income communities.
    Google has not only been a staple of making information accessible 
to individuals on the web, but has also worked in communities to unveil 
demonstration projects delivering even faster broadband speeds. Google 
Fiber is boosting Internet-connection speeds exponentially--to speeds 
heretofore unseen in the United States. Such deployment of new 
technology will give rise to new applications making access even more 
important for the public in the years to come.
    While the NTIA's recent report reminds us that still more needs to 
be done to close the digital divide, leading American companies of the 
Internet ecosystem are producing groundbreaking tools allowing for 
connection to the global community, the dissemination of information, 
and the broad distribution of services. Such investment, 
experimentation, and ingenuity are bridging the technology gap as we 
move into the future.
    The USHCC looks forward to working with the Senate Subcommittee on 
Communications, Technology, and the Internet to expand Internet 
adoption across American households. Should you have any questions 
regarding this issue please feel free to contact Marco De Leon, the 
USHCC Vice President of Government Affairs & Policy, at 
[email protected].
    Thank you for your time and consideration of this matter.
            Sincerely,
                                          Javier Palomarez,
                                                 President and CEO,
                                                                 USHCC.
                                 ______
                                 
    Response to Written Question Submitted by Hon. Amy Klobuchar to 
                              Aaron Smith

    Question. Please describe how the United States compares to other 
countries when it comes to broadband adoption? Countries that excel in 
adoption, what are they doing that can be replicated here? How do our 
broadband adoption rates impact our ability to compete globally?
    Answer. Unfortunately I do not have any definitive answers to your 
question, as my organization has to this point collected only a modest 
amount of data on technology adoption and usage outside of the United 
States. The Pew Research Center's Global Attitudes Project has 
collected data on general Internet usage rates in select countries 
worldwide, and has found that the United States is comparable to 
developed countries such as Britain and Germany in terms of the 
proportion of its population that goes online.\1\ However, we have up 
to this point never attempted to systematically track broadband access/
adoption internationally.
---------------------------------------------------------------------------
    \1\ See http://www.pewglobal.org/2012/12/12/social-networking-
popular-across-globe/
---------------------------------------------------------------------------
    Several other organizations have attempted to examine this issue, 
but much of the existing data is inconsistently collected or based on a 
limited subset of counties. One of the more widely accepted measures is 
a 34-country ranking of fixed and wireless broadband penetration 
produced regularly by the OECD. On this measure, the United States' 
ranking in fixed broadband penetration has fallen from 6th in 2002 to 
15th in 2012. We currently rank more highly (6th out of 34) in mobile 
broadband penetration.
    Additionally, the Council on Foreign Relations recently released a 
very nice ``backgrounder'' document that summarizes the current 
research on broadband adoption across the globe, the economic impact of 
increased access to broadband, and the steps different countries are 
taking to promote increased access to high speed Internet service. 
Their report is available at http://www.cfr.org/digital-infrastructure/
us-broadband-policy-competitiveness/p30687, and I highly recommend it 
if you would like a short yet very informative summary of the latest 
research on the subject.
                                 ______
                                 
   Response to Written Questions Submitted by Hon. Amy Klobuchar to 
                           Bernadine Joselyn

    Question 1. NTIA BTOP grants to Sustainable Broadband Adoption 
programs, like the Blandin Foundation's program, have proved extremely 
successful. How important was the Federal funding seed money to 
securing partnerships and other sources of funding?
    Answer. Blandin Foundation used the NTIA BTOP application process 
to spur the interest of statewide, regional and local partners in 
tackling the digital divide and broadband adoption. When funding was 
received from NTIA, the promise of the partnership was achieved through 
a collaborative and detailed design process that respected 
organizational priorities, capabilities and existing partnership 
networks.
    It is highly unlikely that the MN Intelligent Rural Community 
Project (MIRC) could or would have been launched without the NTIA 
funding for the following reasons:

   Sustainable broadband adoption strategies were generally not 
        high on the priority list of our prospective partners.

   Many of these partners have dedicated funding for specific 
        activities; even if sustainable broadband adoption was a 
        priority, there were no dedicated and/or available funds to 
        address the issue.

   With its broad mission of ``strengthening rural Minnesota 
        communities,'' broadband adoption is only one of Blandin 
        Foundation's priorities. Without matching Federal dollars to 
        leverage the foundation's own investment, it is highly doubtful 
        that the foundation would have made the scope of commitment to 
        this work as it did under MIRC.

   Spurred by MIRC's palpable positive impact on the vibrancy 
        of the communities we serve, Blandin Foundation Trustees 
        authorized continued funding of broadband adoption work in 
        2013-14 at a lesser funding level than MIRC. Absent the NTIA 
        BTOP funds, our current program cannot support the state-wide 
        partnerships enjoyed under MIRC, and thus we have less 
        technical, programmatic, and staff support to offer the 
        participating communities than was available through the 
        federally-funded program.

    Our MIRC partners used the NTIA SBA funds to involve a ``third 
ring'' of organizations across Minnesota. For example, University of 
Minnesota Extension used their funds to collaborate with local economic 
development agencies and chambers of commerce in the delivery of e-
commerce training programs. The MN Department of Employment and 
Economic Development offers another example of cascading partnerships 
sparked by the Federal funding: they partnered with workforce centers, 
libraries, and community education programs to reach un and under-
employed workers in diverse settings. As a result of these 
partnerships, digital literacy curricula developed through MIRC were 
incorporated into Adult Basic Education program offerings across the 
state.
    Blandin Foundation would have been hard pressed to commit technical 
and process consulting, community coaching and financial resources to 
our demonstration communities without the NTIA SBA funds. Federal 
financial resources made it possible for the foundation to help 
communities move relatively quickly from community planning processes 
to project implementation.

    Question 2. What makes your program sustainable and how can any 
lessons learned be exported to other regions of the country?
    Answer. The Minnesota Intelligent Rural Communities project has 
illustrated sustainability in a number of ways:
    With NTIA SBA funding, MN Department of Employment and Economic 
Development, a MIRC partner, designed and delivered effective, learner-
centric, culturally adapted and self-paced digital literacy curricula. 
But perhaps of equal importance, thanks to diligent coordination 
efforts, a sustainable system for course delivery is now in place 
through innovative partnerships with workforce centers, libraries and 
adult basic education classes provided through community education. By 
embedding these curricula into adult basic education, the costs to 
offer these classes are reimbursable to local school districts through 
state education funding.
    In the case of PCs for People, our computer refurbishing and 
distribution partner, participation in the MIRC project enabled them to 
reach a scale of sustainable operations, attracting Digital Citizen as 
a low-cost Internet Service Provider (ISP) partner. Through the 
project, PCs for People opened four affiliate offices across rural 
Minnesota. Inspired by their model, other independent community-based 
computer refurbishment efforts are growing, including with the 
participation of ISPs enticed by findings that over 80 percent of 
first-time Internet subscribers retain their subscriptions even after 
their initial income-adjusted subscriptions expire.
    The broadband adoption initiative in the town of Thief River Falls, 
one of the MIRC communities, has grown to a regional effort. Just 
recently, regional broadband champions organized the collection of 
approximately 200 monitors and 100 computers from area businesses. This 
equipment will be refurbished and distributed to qualifying families. 
High school students, under supervision of workforce agency staff, do 
the computer refurbishment and train the new computer owners in basic 
skills.
    Blandin Foundation, in its MIRC design, invested in evaluation. The 
data provided by the evaluation strategies demonstrated the value and 
results of the work. That evidence led the Foundation to continue its 
investment in broadband access and adoption. We also use this data to 
make the case to local and regional leaders that broadband access and 
adoption is key to economic vitality.
    The Intelligent Community \1\ benchmarking and planning processes 
embedded in MIRC design provided citizens and leaders with a solid 
understanding of community technology needs and opportunities, and led 
to each community identifying its own unique priorities and utilizing 
its unique assets to develop and implement projects to address those 
needs and seize those opportunities. The benchmarking provided clear 
evidence of progress in each of the Intelligent Community framework's 
five focus areas: broadband connectivity; knowledge workforce; 
innovation; digital inclusion; and marketing and advocacy. This system 
gives communities tools to quantify their progress and encourages them 
to continue to move forward.
---------------------------------------------------------------------------
    \1\ Intelligent Community Forum; www.intelligentcommunity.org
---------------------------------------------------------------------------
    The websites, applications, school programs and community-based 
projects launched with the help of NTIA SBA funding (over 100 in all) 
continue to yield benefits to MIRC communities. For example, the eleven 
public access Internet sites opened in libraries, grocery stores, 
American Legion halls, parks, YMCAs, laundromats and many other venues, 
remain open as part of these organization's ``new way of doing 
business.''
    Even more importantly, community leaders, organized as teams 
through the MIRC project, are now motivated, coached in community 
leadership skills, informed through ongoing information and training 
services (webinars, e-newsletters), and determined to ``stay the 
course.'' They continue to respond to community technology 
opportunities and challenges. For example, when a Minnesota state 
senator wanted to call host a series of roundtable broadband policy 
events across the state's rural counties, MIRC communities stepped 
forward to host these discussions which helped to elevate the 
importance of connectivity as a key determinant of Minnesota 
communities' economic and social well-being.
    Below are some of the lessons we've learned about what makes 
broadband adoption programs effective:

   Our experience in Minnesota supports research results 
        showing that economic growth follows telecommunications 
        investment. However, we've also learned that investment in 
        infrastructure is not enough. ``If you build it they will 
        come'' does not apply to broadband. Concerted, sustained cross-
        sectoral engagement at the community level is required to 
        create the ``culture of use'' necessary to deliver on the full 
        promise of digital literacy and global connectivity.

   Even given the socioeconomic and demographic barriers to 
        increasing broadband adoption encountered by the MIRC 
        demonstration communities, it is our experience that programs 
        designed to increase computer access and Internet use for low-
        income populations can address these disparities, although 
        recruiting these target populations to participate in offered 
        programs can be challenging.

   The greatest impacts are achieved when decisions are made 
        closest to home. It has been our experience that rural 
        communities can achieve big results with relatively small of 
        amounts of funding when that funding is locally controlled. 
        Encouraging and resourcing community-based teams to set goals 
        and develop plans to achieve them increases community impact.

    Communities know best. Involve citizens directly in articulating 
their community's broadband adoption and utilization goals to catalyze 
long-term engagement needed to increase adoption.
    ``It seems as though communities impacted by this project felt a 
rejuvenated sense of community because there were so many people 
rallying to get these projects done for their school, community or 
organization.''--Jacki Anderson, Upper MN Valley RDC
    Local leadership matters. Help local broadband champions get and 
use skills to frame issues, build and sustain relationships and 
mobilize people to build a community's capacity to achieve its 
broadband goals. Train community leaders and champions to use 
participatory facilitation skills; effective meeting facilitation can 
make a big difference in keeping folks coming back to the planning and 
implementation table.
    ``Our elected officials now see the importance of broadband for 
economic development and community vitality.''--Nancy Hoffman, Benton 
County Economic Development Director
    Broadband is not an end in itself. It is a means to the higher ends 
of increased economic vitality and improved quality of life. Framing 
this work in these terms, or as a necessary but not sufficient 
condition for innovation, connectivity, and equal opportunity for all, 
or as a prerequisite for full participation in our democracy, is likely 
to be more successful than by calling out the technical infrastructure 
itself.
    ``In an era when digital access is an essential element of full 
participation in modern society, when digital technology can be the 
deciding factor between economic opportunity and isolation, between 
social change and increasing inequality, and between democratic 
participation and standing on the outside looking in, it is critical to 
the future of our country . . . to ensure that everyone has high-speed 
. . . access to an open Internet.--Luis Ubinas, President, Ford 
Foundation
    High-touch outreach works. Effective recruitment strategies for 
technologically-challenged small business and for historically 
marginalized populations are intra-community, hyper-local, ``high 
touch,'' and personalized. Change follows relationship lines.
    ``These technology classes have encouraged our Hispanic and Somali 
immigrants to interact, really for the first time.''--Fatima Said, 
Project FINE, Winona
    Peers make great teachers. Peer-based learning formats that 
encourage local businesses to share practices, questions and 
experiments are a popular, low-cost, and easily sustainable tool to 
build a community's technological savvy.
    [Digital presence course] ``Basically gets you acclimated to it 
[online marketing], and learn how to make it work for you.''--Susan 
Reiter, Coffee Choices coffee shop, Jackson
    Cross-community communication is key. Signage, local media support, 
and online social media are effective, low-cost ways to spur and 
sustain energy and excitement for community projects.
    ``This effort has helped us develop wonderful community 
connections. We have reached out to our whole community.''--Keri 
Bergeson, Principal, Dawson/Boyd High School
    Engage tomorrow's leaders today. Recognize and authentically engage 
the talents of young people. This next generation of leaders bring 
energy and sustainability to any community initiative. Youth can serve 
as co-trainers, technology mentors, partners in computer refurbishment 
projects, and use their video and other social media to promote their 
communities.
    ``My customers are couples planning weddings, so I need my website 
updated and fresh, and to be found using mobile devices. The students' 
work on my site and Google Map location was great.''--Donna Henry, 
Henry Catering, Foley
    Connect the economic dots. Framing increased sustainable broadband 
use a necessary but not sufficient ingredient in a ``whole systems'' 
approach to strengthening community vitality can help communities see 
and leverage the connection between technology and benefits to 
community life. The ``whole picture'' Intelligent Community framework 
for community and economic development used in MIRC can help community 
leaders see how workforce, infrastructure, inclusivity, innovation and 
marketing/advocacy are mutually interdependent aspects of community 
vitality.
    ``This framework brings people together that have not always worked 
together--technology advocates, workforce, social service agencies, and 
economic development professionals.''--Danna MacKenzie, Cook County IT 
director
    ``The involvement of local citizens, government, business and non-
profit groups working together to enhance the effort to make the 
community better by forming a partnership that shares the same goals, 
aspirations and hope for the future of the whole county.''--Michael 
Haynes, Stevens County Economic Development Director
    Have patience. This work takes time. Look for and celebrate early 
and easy ``wins'' along the way, but think long-term and build capacity 
and energy for the long-haul. Money and other resources follow vision 
and commitment.

    Question 3. Can you discuss how investing in broadband adoption is 
good for the economy? What level of return on investment do you tend to 
see from broadband adoption programs? What is the best way to measure 
broadband use and its impacts?
    Answer. Broadband is a key driver of innovation and economic 
development. Evidence abounds that high-speed Internet access has 
powerful economic benefits (positive impact on median household income, 
employment, and business growth).
    Broadband access is key. . .but so is adoption. Investing in 
programs that stimulate the use of broadband delivers meaningful 
economic benefits. According to the report, ``Broadband's Contribution 
to Economic Health in Rural Areas: A Causal Analysis,'' by B. Whitacre, 
S. Strover, and R. Gallardo (March 26, 2013), ``Non-metro counties with 
high levels of broadband adoption in 2010 had significantly higher 
growth in median household income between 2001 and 2010 compared to 
counties that had similar characteristics in the 1990s but were not as 
successful at adopting broadband.''
    Strategic Networks Group, an economic consultant firm working with 
local governments in North America, Europe and Australia on the 
benefits of broadband, has compiled evidence from studies they have 
conducted in North Carolina, Virginia, Kentucky, Illinois, and Nebraska 
that demonstrate a $5 million economic development impact for every 
1,000 broadband passes installed.\2\ Their data show that 23.4 percent 
of all new jobs created in the economies they have studied are directly 
attributable to broadband (i.e., if it had not been for broadband, 
those jobs would not exist). These are not only IT jobs, but include 
jobs like shipping, account management, etc. that are needed as the 
business grows. For example, a study they conducted in North Carolina 
in 2010 showed that 32 percent of all households surveyed report having 
home-based businesses or telecommuting, and 14 percent plan to start 
using broadband at home to support their households. Of businesses 
surveyed, 56 percent said that access to high-speed broadband was 
essential for remaining in their current location.
---------------------------------------------------------------------------
    \2\ http://sngroup.com/tag/broadband-economic-impacts
---------------------------------------------------------------------------
    Moreover, businesses that increase their utilization of broadband 
by ten percent realize a 24 percent gain in revenue and a seven percent 
reduction in costs. And the higher the degree of sophistication of use 
of broadband-enabled services, the higher the benefit: 54 percent of 
revenue from businesses using high levels of broadband utilization come 
from the Internet.
    Blandin Foundation recently commissioned SNG to study the ROI in 
broadband infrastructure and utilization initiatives in two Minnesota 
counties, Lac qui Parle and Kanabec. The results of this study were 
illustrative and on par with SNG research and findings in other regions 
as described above. Generally speaking, an investment of $120-145,000 
in Lac qui Parle and $175-225,000 in Kanabec might leverage effect as 
much as 10 to 1; so for every $1 invested, $10 is returned in direct 
and spinoff impacts to the local economies.\3\
---------------------------------------------------------------------------
    \3\ The Return from Investment in Broadband Infrastructure and 
Utilization Initiatives, Jan 2014, http://bit.ly/1ko1kJT
---------------------------------------------------------------------------
    Economic Benefits of Broadband. The following are key findings from 
SNG's ongoing research into the economic benefits of broadband.
    Using broadband creates jobs. Over 22 percent of all new full-time 
jobs created by 3,326 surveyed businesses are attributed to their use 
of broadband. This effect is even stronger for the 2, 337 surveyed 
small businesses (fewer than 50 employees) where over one in four new 
jobs created (26 percent) are attributed to using broadband. Small 
businesses represent over 95 percent of establishments and almost half 
of total employment.
    Using broadband increases business revenues. 963 small businesses 
surveyed (fewer than 50 employees) report that over 30 percent of their 
revenue is attributed to using broadband. More importantly, businesses 
that make greater use of broadband generate a higher percentage of 
revenue than businesses that use fewer applications--almost 37 percent 
of revenue for high users versus less than 10 percent of revenue for 
low users--a ratio of almost 4 to 1.
    Using broadband contributes to economic growth. As businesses 
increase their use of broadband their new revenues and cost savings 
contribute to economic growth. For example, increasing utilization of 
broadband by 5 percent for 1,000 businesses would increase regional GDP 
by $17M, add $1.8M in taxes, create $9.5M in household income, and 
create 185 new jobs.
    Broadband benefits communities. The availability of broadband is a 
significant factor in attracting and retaining businesses and 
households for communities. Over 38 percent of 8,416 broadband 
households surveyed report that they would very likely relocate to 
another community if broadband was not available. Over 48 percent of 
11,870 businesses with broadband surveyed say that the availability of 
broadband is essential or very important for selecting their business 
location. Over 75 percent of these businesses reported that broadband 
is essential or very important for remaining in their present location. 
Communities that do not have adequate broadband services risk losing 
households and businesses over time.
    Broadband enables income opportunities for households. Eighteen 
percent of 9,478 households surveyed operate a home business and 17 
percent telework, creating new or improved income opportunities for 
households. Almost 90 percent of these surveyed home businesses say 
that broadband is essential for operating their business. Almost half 
of teleworkers say that they would not have their present job without 
being able to telework.
    Measurement. Measuring broadband use is a tricky problem and one 
that may be best considered on a case-by-case basis. In Minnesota, for 
the MIRC project, evaluators utilized three separate methodologies to 
estimate broadband use in terms of subscribership. First, baseline 
surveys were conducted in each demonstration community, along with a 
statewide survey to estimate broadband penetration across all 
geographies. Second, Minnesota Cable and DSL providers agreed to 
provide new subscriber information in aggregate, to assist, but still 
maintain provider confidentiality. And third, we contracted with a 
private firm to provide detailed Internet transactional data for each 
of the 11 demonstration areas. Using these three methods project 
evaluators triangulated the data to derive accurate subscription 
estimates. Project benchmark surveys on broadband penetration were 
performed at the end of the project period.

    Question 4. What recommendations would you give to this committee 
on shaping policies to continue promoting broadband adoption, both in 
terms of funding and programming assistance from Federal agencies? How 
can NTIA and the FCC effectively support ongoing broadband adoption and 
meet the goals of the National Broadband Plan?
    Answer.

   Provide support to take broadband adoption to higher levels 
        of utilization and sophistication. As important as it is for 
        all Americans to have a basic level of digital literacy, it is 
        also critical that both workforce and business continue to 
        drive their sophistication of use higher so as to fully capture 
        the potential value of the network.

   As wireless technologies are increasingly counted as an 
        acceptable broadband technology to reach 4 Mbps, ensure that 
        bandwidth caps are set high enough to enable critical customer 
        applications such as telehealth and online/Internet-based 
        learning. Benefits of being connected are diminished if 
        bandwidth caps inhibit sophisticated use of the network.

   Reward programs that focus on the ``so what'' of adoption. 
        In other words, programs that lead directly to enhanced 
        education, workforce opportunities, business creation and 
        expansion, improved health care outcomes, etc. should be 
        encouraged and supported.

   Four Mbps is not enough bandwidth, now and into the future, 
        to support advanced or even every-day technology use. To 
        attract Federal CAF or other support, providers must invest in 
        network technology improvements that can provide significantly 
        higher capacity.

   Adopt life-line programs for broadband.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Marco Rubio to 
                            Hon. John Sununu

    Question 1. In your testimony you state that ``government should 
ensure that regulations do not hinder or crowd out investment in the 
broadband and Internet industries.'' Can you expand on that--why do you 
believe government regulations will hinder broadband deployment and 
investment?
    Answer. In the Telecommunications Act of 1996, Congress adopted a 
light-touch regulatory approach for the broadband and Internet 
industries that has led to enormous levels of capital investment. Since 
that year, telephone, cable, and wireless providers have invested over 
$1.2 trillion to build a robust broadband network, and the results are 
evident. Approximately 99 percent of Americans now have access to 
broadband, and new Internet-based industries have been created.
    There is no sound basis to revisit the regulatory approach that has 
enabled this success.
    Over-regulating broadband would risk dampening providers' 
incentives to invest, and because broadband technologies advance so 
quickly, it would also risk inhibiting the development of new and 
innovative technologies and practices. Regulation, if any, must be the 
last option in order to allow the Internet to realize its full 
potential without the persistent threat of government intrusion.
    Broadband adoption is one of the best examples of how the light-
touch approach has worked effectively, as broadband adoption has 
increased faster than almost any other technology. Policymakers should 
be mindful of this success. Any future regulatory action should avoid 
applying old regulations to new technologies, and should be tied to 
actual market failures. Regulation should not be used to pick winners 
and losers in the broadband marketplace.
    And government should not build, or fund other entities to build, 
broadband networks in areas where unsubsidized private entities have 
already built such networks.
    Government should promote, not hinder, broadband deployment and 
adoption.

    Question 2. I would like you to talk about the importance role 
wireless broadband plays in the digital economy and in broadband 
expansion. How important is making more spectrum available to the 
future of wireless broadband and to promoting competition in the 
broadband market?
    Answer. It is critical. The U.S. is the global leader in mobile 
broadband across virtually every metric:

   American wireless companies invested more than $30 billion 
        in building out cutting edge networks last year alone.

   We have roughly half of the world's 4G LTE customers.

   Smartphones now account for 60 percent of all U.S. mobile 
        phones, and 25 percent of adults own a tablet.

   1 out of 10 American's only broadband connection is their 
        smartphone.

   By 2012, 82 percent of Americans were able to choose between 
        at least 4 wireless broadband providers.

   Traffic on licensed mobile wireless networks increased 70 
        percent in 2012.

   Over one-third of all IP traffic is now carried over 
        unlicensed Wi-Fi networks, and Wi-Fi traffic is expected to 
        triple between 2011 and 2016.

   The wireless industry supports more than 3.8 million high-
        paying American jobs--2.6 percent of all U.S. employment. 
        Wireless employees are paid 65 percent higher than the average 
        worker. Wi-Fi and other unlicensed services support billions 
        more in investment and economic opportunity.

    Spectrum is the lifeblood of this mobile revolution--yet the 
spectrum in use, and in the pipeline, is not sufficient to handle the 
anticipated growth in demand. As a result, there is a looming threat 
that, just around the corner, we will see congested networks leading to 
slower speeds and lost opportunities for consumers. If we want to 
continue our global leadership, more spectrum is needed for the private 
sector, both licensed and unlicensed.
    Consumers want reliable high-speed wireless services. These 
services are not possible without more spectrum being made available to 
private companies. Wireless broadband has unleashed waves of innovation 
that have driven industries like the apps economy--which now employs 
over 750,000. Making more spectrum available will only further drive 
innovation and job growth.
    Sufficient spectrum is vital to ensure the availability of future 
wireless capacity that Americans demand as well as to promote 
competition among existing providers and new entrants alike. With 
sufficient spectrum resources, providers will have the ability and 
incentive to invest in faster and more robust networks and to provide 
new and innovative broadband offerings.
    It is very important for the FCC to move quickly on these issues. 
It can take up to 10 years and cost billions of dollars for newly 
acquired spectrum to be used in the marketplace. If we want to stay at 
the forefront of the wireless technology tomorrow, the FCC must release 
new spectrum as soon as possible.

    Question 2a. Do you think that the FCC neglects to consider 
wireless broadband a vibrant competitor to wireline broadband because 
doing otherwise would destroy the ``scarcity'' argument that underlies 
the very need for regulation?
    Answer. Wireless broadband can, and should, be considered a 
competitor to wired broadband. Today's high-speed wireless networks are 
capable of speeds that meet, and sometimes exceed, the speeds offered 
by some wired broadband services. A study conducted last year by 
RootMetrics found that the average downstream speed across the three 
national LTE networks at that time ranged from 10.3 Mbps to 18.6 Mbps 
with maximum speeds up to 57.7 Mbps. To put this into context, the FCC 
requires a service to provide only 4 Mbps downstream in order to be 
considered ``broadband.''
    Roughly two-thirds of U.S. broadband connections are wireless 
today, and minority communities have far higher than average mobile 
adoption and utilization levels. Each household makes its own decisions 
based on its needs and budget. Some prefer to subscribe to both wired 
and wireless broadband options, while others select one or the other. 
The FCC should not second guess those decisions.

    Question 3. Pew says that because there is ``no widespread 
consensus as to whether 3G or 4G smartphones qualify as 'broadband' 
speed, and [because] many would question whether they offer the same 
utility to users as a dedicated home Internet connection'', wireless 
broadband connections are not included in Pew's definition of 
``broadband user.'' Given the widespread deployment and significant 
adoption of 4G technology, is this ``wireless isn't equal'' thinking 
correct?
    Answer. No, the notion that wireless services cannot qualify as 
``broadband'' is simply outdated and inaccurate. The characteristics of 
LTE wireless broadband service--including the speeds noted above--and 
the popularity of wireless broadband offerings today contradict any 
efforts to systemically exclude or discount them.
    Both wired and wireless broadband connections allow users to stream 
videos and music, access news and social media websites, edit online 
documents, and access cloud-based software. In addition, both wired and 
wireless connections provide access to health care, education, and job 
information (functions which the FCC has rightly identified as 
essential). Given the exponential growth in wireless broadband, it is 
imperative for the government to consider wireless services in any 
assessment of the broadband market in order to properly evaluate 
competition across platforms.

                                  
