New York City Mayor de Blasio Makes $70 Million Commitment to Universal Broadband

By Peter Bernstein May 06, 2015

It was no doubt a coincidence, but at the Tech Crunch Disrupt conference in New York City this week, the city’s Mayor, Bill de Blasio, took a rather bold step. He announced his administration’s commitment to making affordable universal broadband a reality in the most populous city in the U.S. by 2025.

While the $70 million in funding that was announced is being hailed by some as “one of the most prominent financial commitments that an American city government has made toward universal broadband,” it is worth stepping back from the hyperbole. After all, 10 years is a long time to wait to achieve the goal and $70 million, even when adding $1.6 million in New York State funds for spreading broadband in industrial zones, seems hardly enough to get the job done.  However, you have to admire the Mayor’s vision and maybe even his moxie.

A man with a plan and hopefully help from industry

The Mayor has long recognized that connectivity is a critical key to the long-term economic vitality of the City.  For educational as well as commercial reasons, Mayor de Blasio has been a strong advocate for assuring all citizens and businesses have state-of-the-art and affordable access to the Internet.  In fact, he has applauded the efforts that former Mayor Michael Bloomberg initiated to get the business and academic community and other stakeholders engaged on keeping New York an epicenter of the digital revolution.  However, the facts are that about one-fifth of the city’s households have no Internet connection and among the poorest families, many of whom are minorities that number jumps to 36 percent.  Hence, the challenge is to bridge the digital divide, something the populist mayor sees as one of his most important missions.

Mayor de Blasio’s OneNYC Plan sets out affordable universal broadband coverage as a top priority. The resulting $70 million financial commitment over 10 years is front end loaded with much of the money being allocated in the first three years. 

In terms of allocation of funds, it goes as follows:

  • $25 million for new wireless corridors, which will deliver free or low-cost access to 20,000 low-income households.
  • $7.5 million will go to upgrading or expanding at least five existing wireless corridors, including ones such as the Harlem free Wi-Fi zone.
  • $1.6 million in New York State funds will focus on broadband around industrial zones for at least 500 businesses.

In addition, the goal is that by 2017 there will be roughly 1,500 kiosks,  which typically are repurposed phone booths, strategically deployed in all five boroughs of New York that will offer up to 1 gigabit per second in speed plus free calling through a touchscreen. The ultimate objective is to deploy 7,500 of these kiosks and to have their cost off-set via advertising.  This is not a bad way to go as visitors to New York are well aware that any space seen as one that attracts people, or at least their eyeballs, is more than fair game for ads.  

“Broadband is no longer a luxury – it’s as central to education, jobs, businesses and our civic life as water and electricity,” said Maya Wiley, who serves as counsel to the mayor. “For the first time in the history of the City, broadband is in the capital budget.”

Looking ahead

It is that last statement by Wiley that makes this action something more than a local news item in the U.S.  While Mayor de Blasio has been careful to say that it is not his intention to put the New York City government into the communications business, and he has reached out to the business community in meaningful ways to get them on board with their money and talent, how far the local elected officials are likely or willing to go to assure universal broadband access is very much an industry concern.  

Image via Shutterstock

In fact, municipal broadband as a “yea or nay” issue is a political hot potato.  The Obama Administration and the FCC are proponents. They cite the benefits of cities that have already taken the plunge, and object to state policies and initiatives to ban such efforts.  Let’s just say service providers have some issues with this in terms of the possible competition cutting margins, creating churn and overall devaluing their franchises. 

The challenge is that whether it is poor inner city neighborhoods or rural areas, there is a digital divide in the U.S., and that gap needs to be bridged for all of the right reasons, and competition has not gotten the U.S. where it should be and must be going forward. 

In 1934 the Federal Communications Commission (FCC) was created with a mission to assure that all citizens had access to basic communications services at affordable rates.   Now 81 years later it seems amazing how universal access to affordable basic communications— as defined by policy-makers as to what should be “basic service” based on the context of the time—remains a vision instead of a reality. 

Public-private partnerships such as is the current direction of Mayor de Blasio are not a bad way to go.  I will show a bit of personal prejudice by saying that my own faith that government could operate a communications network better than those who have expertise and a financial incentive is almost not capable of being measured.  However,  given what is going on in other countries in terms of their commitments to national universal broadband, this does seem to be a case of too little that might be too late.  We do need a plan and not just one for New York City.  




Edited by Dominick Sorrentino
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