Details of stimulus for rural broadband getting closer scrutiny, raising questions

One way in which both the House and Senate versions of the economic stimulus bill look to improve rural America is by extending broadband access to areas that don't have it. But that plan has begun to attract criticism. "Some officials question the emphasis on expanding high-speed Internet access when many Americans cannot afford the service that is already available to them," reports Philip Brasher of The Des Moines Register.

According to Jim Harper, who follows telecommunications policy for the Cato Institute, "Equipment manufacturers will pocket a lot of the broadband money simply by raising their prices, and money is likely to be wasted because of the speed with which the grants and loans must be dispensed."

In Iowa there is evidence that access to broadband in rural areas will be underutilized. In that state rural areas have better access to broadband than more populate areas. Brasher adds, "Industry officials say the high-speed service often goes unused because elderly or low-income people don't pay for it." (Read more)

David Herszenhorn of The New York Times writes that the bill's "proponents say it will create jobs, build crucial infrastructure and fulfill a campaign promise of President Obama's: to expand the information superhighway to every corner of the land, giving local businesses an electronic edge and offering residents a dazzling array of services like online health care and virtual college courses. But experts warn that the $9 billion effort could become a cyberbridge to nowhere, representing mistakes lawmakers could make in rushing to approve one of the largest spending bills in history."

Herszenhorn adds, "Supporters simply cannot wave away the potential pitfalls, including the fact that it would take at least until 2015 to spend all the money on infrastructure to deliver the service — vastly limiting the stimulating punch. Already there has been sharp criticism of provisions in the Senate version that seem intended to benefit large Internet service providers, particularly Verizon, which could potentially claim hundreds of millions of dollars in tax credits. ... Supporters of the measure say the potential benefits of broadband access outweigh any risks." (Read more)

"When broadband is available, rural communities put it to use — often in ways unimaginable to those in the cities (or in some offices in Congress)," says the Daily Yonder. "Broadband Internet service is being used for vital commercial purposes in rural America," Douglas Burns reports.