In the United States, market-led deployment of broadband internet—along with service provision dominated by a small oligopoly of giant telecommunications corporations—has led to inadequate development and severe inequities. For instance, according to the Federal Communication Commission’s estimates (which many experts think are highly understated), more than 21 million Americans don’t have access to even a minimal high-speed broadband connection of at least 25 mbps. Internet access in the United States is also generally far slower and more expensive than in most other advanced countries.
Unavailable or unaffordable internet puts certain communities at a disadvantage and reinforces inequality. For instance, while one in five White Americans don’t have high-speed internet at home, that ratio is roughly one in three for Black Americans, and one in 2.5 for Latinx Americans. As numerous reports have indicated, communities with inadequate internet access have been unable to access remote learning opportunities during the pandemic.
If school closures persist, these students will likely fall even further behind their wealthier, and often whiter, peers. Preliminary data from the Covid-19 crisis in the United States is already revealing stark racial and socioeconomic disparities concerning who is affected medically, economically and socially. This lack of affordable and accessible internet is likely to only exacerbate these inequalities.
A new report released by The Democracy Collaborative (US) and Common Wealth (UK) contends that it is time to stop treating high-speed internet like a luxury commodity and instead consider it public infrastructure. And as with other infrastructure, this means taking it out of the hands of corporations and putting it under democratic and public control.
In the United States, one way to realize this vision is to empower and support communities that want to establish their own broadband internet networks. First and foremost, this means passing federal-level legislation that overturns pro-corporate, state-level “preemption laws” that ban or restrict municipalities from launching or expanding their own public broadband networks. Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.) both supported such action during their recent presidential campaigns, and legislation to this effect—called the Community Broadband Act—has been introduced in Congress by Rep. Anna Eshoo (D-Calif.) and Sen. Cory Booker (D-N.J.).
Rather than impede their development, federal and state governments should also directly help finance and provide technical assistance to municipal and other community-based broadband networks. That would be a far more effective and equitable use of public resources than the FCC’s current patchwork of subsidy programs, which largely benefit the telecommunications companies themselves.
A parallel effort should take place with regards to 5G wireless. In the United States, just three large corporations—AT&T, Verizon and T-Mobile—are poised to control virtually all of the nation’s 5G wireless infrastructure for at least the near future. Yet there is nothing to prevent a new racial and class digital divide growing around this emerging technology. A “public option” in the wireless communications sector builds on the precedents set by such public ownership examples as Germany’s majority ownership of Deutsche Telekom and Norway’s majority ownership of Telenor, and was even reportedly being considered by President Trump in response to China’s growing state-controlled dominance in the sector. A publicly-owned wireless network could help address market failures, reduce corporate power, provide competitive pressures that would lower costs and stimulate innovation, and generate revenue to cross-subsidize other needed public services and investments.
We should also consider new, innovative ways to think about one of the public’s most valuable renewable resources, the wireless spectrum (sometimes known as the public airwaves). This asset is managed on behalf of the public by the federal government, which keeps some frequencies for public purposes and leases others out to various types of communications companies. The FCC currently conducts extremely lucrative spectrum auctions, netting tens of billions of dollars in revenue for the government. Rather than simply being deposited in the Treasury, these proceeds could, for instance, be used to capitalize democratically governed public trust funds that would be tasked with making investments in digital infrastructure, such as municipal broadband, as well as local journalism and media.
Finally, these strategies should, ultimately, be coupled with democratizing cloud computing services. These services, overwhelmingly controlled by just three companies—Amazon, Google and Microsoft—are the terrain upon which most of today’s internet activity takes place. This corporate control leads to prohibitively high costs for smaller companies seeking cloud services, excludes smaller cloud competitors, stalls innovation, and gives these powerful and largely unaccountable actors corporate control over valuable personal and business data. Many experts have suggested that if Big Tech companies are to be broken up, then cloud computing would be the logical, and ideal, first candidate. However, since cloud services play such a foundational role in the modern economy, it makes little sense to simply create new, private companies that would likely replicate the same abusive practices as their predecessors. Rather, they should be spun off from these Silicon Valley giants and converted into public utilities accountable to all of us.
Democratic public ownership of digital infrastructure can reduce corporate concentration and the outside political power of the digital giants. It can enable us to link the build-out and operation of digital infrastructure to ecological sustainability and a Green New Deal. It can be a powerful tool for addressing the racial and urban-rural digital divides. And it can provide a mechanism for people to assert control and power over their own data. Most fundamentally, it gives us a new arena for democratic decision-making and a stake in the new system we seek to build out of the devastation caused by the current Covid-19 crisis.
May 18, 2020
DEMOCRATIC OWNERSHIPDEMOCRACY & GOVERNANCE
The global spread of COVID-19 has shone a bright spotlight on both the vital need for reliable high-speed internet and the inadequacies of the for-profit, corporate model in delivering it. This paper, the first of four modules on democratic public ownership in the United Kingdom and the US, explores the future of digital infrastructure: the core assets and services upon which the 21st-century economy and its vast array of information technologies rely. To accelerate and democratize digital infrastructure development, new approaches to ownership and control are vital.
While there are important differences explored in this paper between experiences in the US and the UK, both share at least one important common thread: a market-led approach to digital infrastructure development predominantly undertaken by, and to the benefit of, an oligopolistic set of for-profit corporations. This, in turn, has created shared problems, from prioritizing shareholder returns over investing in vital infrastructures, to undemocratic ownership and governance of essential services and digital redlining as companies cherry-pick provision, excluding poorer areas and marginalized groups.
The result: the UK is ranked 35th out of 37 countries assessed by the OECD for the proportion of fiber connections in its total fixed broadband infrastructure, and only 13% of households have a full-fiber connection. In the US, 21.3 million people do not have access to the minimum speed broadband connection while approximately 133 million people—nearly half the country—do not have access to a connection with speeds of at least 250Mbps. In both countries, sharp digital divides in access and quality of connection have been exposed by the coronavirus lockdown.
We need to build a digital landscape that provides world-class connection to all, is sustainable, privacy-enhancing, rights-preserving, innovative, and democratic by design. The economic and environmental benefits of such a transformation—from a £63 billion boost to gross value added by 2030 in the UK, and 360,000 tonnes fewer of carbon dioxide emitted as a result of better home working—are extraordinary. In order to secure these benefits, we make the case for democratic public ownership of the foundational digital infrastructures of the 21st century must be rooted in the following key goals and principles:
- Provide full-fiber access to all, overcoming the digital divide and ensuring everyone is able to access high-speed, reliable, full-fiber based connection. Connectivity is a basic need that should be met free at the point of use for all, with the foundational goods and services we all need to participate fully in society made universally accessible.
- Empower citizens and workers through participation, transparency, and accountability, so digital technologies can function as important tools to allow people to engage directly in decision making, and grant them a stake in the world that the internet is helping to build.
- Reduce corporate concentration and political power by replacing for-profit corporations with democratic alternatives.
- Link digital infrastructure to ecological sustainability and a Green New Deal, so that digital technologies can play a critical role in supporting new systems that are efficient, resilient, and decarbonized.
- Ensure that people have control and power over their own data, to develop an ethical data management strategy, which establishes limits as to what data should be collected, as well as data sovereignty, privacy, encryption, and collective rights to data.
To secure these goals, we therefore propose moving in the direction of treating digital connectivity as a right and organizing digital infrastructure – including the wireless spectrum, cloud infrastructure, and the rollout and maintenance of fiber optic connections and 5G – as a vital 21st-century public good, underpinned by democratic ownership and governance. What follows is a series of policy recommendations for the UK and US retrospectively to those ends.
Another digital world is possible. But delivering it will require moving beyond the “regulatory state” and market-oriented approaches that have dominated the development of digital infrastructure in the US and UK in recent decades—and which, while delivering a rich stream of dividends for private investors, have led to the slow roll-out of fiber/broadband, increased corporate concentration and control, and a deep digital divide. Instead, public policy should seek to reshape how digital infrastructure is deployed and owned, moving from conditions of private enclosure to a digital commons.
Digital infrastructure policy proposals (United States)
Overturning state-level pre-emption laws
In order to ensure that local communities retain the authority to establish publicly owned broadband networks if they so choose, we recommend passing federal legislation that ends state-level restrictions on public and community-owned broadband networks at the local level.
Federal funding to develop and operate municipal and community broadband networks
In order to increase access and affordability, as well as reduce the power and control of large telecoms corporations, we recommend passing federal legislation that provides funding for communities and municipalities that are seeking to build public or cooperatively owned broadband networks.
State funding and technical assistance programs for municipal and community broadband networks
At the subnational level, we recommend that state governments establish funding and technical assistance programs to support the development of local, publicly owned broadband networks (and at the local level, communities use these resources to educate the public and create new publicly owned broadband networks). The latter could include educational and organizing support for local communities and residents seeking to establish public networks, planning, project management, backroom operational infrastructure, and help navigating state and federal regulatory requirements. Further, we recommend that state governments direct public resources and broadband investments exclusively to public, cooperative, or nonprofit entities.
Democratic public trust funds for wireless spectrum auction proceeds
At the federal level, we recommend Congress pass legislation directing that most, if not all, federal revenue derived from wireless spectrum auctions be deposited in a democratically managed public trust fund or funds. These funds could be organized like the sovereign wealth funds that exist in numerous other countries (as well as several US states) and invest (with appropriate criteria) in companies, real estate, and other assets.
State and local trust funds to support local media and journalism
At the state and local level, we recommend developing legislation ensuring that any local media station or company (either public or private) receiving spectrum auction proceeds in exchange for shutting down or consolidating operations transfer a portion of those funds into a democratically managed trust dedicated to funding local, independent or public media and journalism.
A public option in the wireless communications sector
In order to provide badly needed competition in the wireless communication sector and provide accessible and affordable wireless broadband and 5G service to all Americans regardless of geography and socio-economic background, we recommend that the federal government create its own publicly owned telecommunications company. The existence of a “public option” in the wireless communications sector could help address market failures, reduce corporate power and concentration, provide competitive pressures that would lower costs and stimulate innovation, and generate revenue to cross-subsidize other needed public services and investments.
Break up big-tech and turn cloud computing services into a public utility
We recommend developing legislation to break up Big Tech companies by specifically mandating that companies over a certain size divest their cloud infrastructure/computing business. Once divested, these services should be organized as decentralized and democratically governed publicly owned utilities.
Digital Infrastructure Policy Proposals (United Kingdom)
A new public infrastructure company with a mission to deliver a nationwide full-fiber network by 2030
The UK government’s own analysis suggests a monopoly provider would deliver a nationwide full-fiber network faster and at significantly lower cost than via “enhanced competition” among an oligopoly of private companies. To that end, a new public infrastructure company should be created tasked with rolling out a 100% full-fiber network by 2030, based on taking Openreach (and the parts of BT Group relevant to rolling out the core network) into public ownership. A mission to connect the nation should be central to a post-COVID recovery that is prosperous and just, with a ‘retrofitting revolution’ building a 21st-century digital infrastructure.
A portion of funding for investment could come from charging private ISP providers for access to the network, just as Openreach currently does. Rather than paying dividends, the company should reinvest profits back into rolling out the network. BT Group has paid out over £53bn in dividends since privatization, and over the past decade has seen its fixed investment and R&D spending fall as shareholder payouts have risen. This logic should be reversed; indeed, the annual savings from eliminating dividends could alone cover over 16% of the Capex required to deliver full-fiber over 10 years. The cost of public borrowing for investment is notably lower than for private companies, and is at near-record lows; to finance the remaining Capex requirements, the public infrastructure company should take advantage, borrowing to invest. Just as Gladstone nationalized the telegraph industry and Asquith took the telephone sector into public ownership, to ensure universal coverage and access, so democratic public ownership can build a foundational 21st-century digital infrastructure more affordably, equitably, and speedily than the alternatives.
Internet access should be organized as a 21st-century human right, recognizing it is now foundational to our ability to lead a fulfilling life in the digital age: to connect, communicate, play, and work. The effects of coronavirus—where a digital divide over access to and quality of broadband has exacerbated social and economic inequalities—have underscored the need to make access to broadband a right, not something delivered primarily through the market. To that end, as part of an ambitious universal basic services agenda, the ultimate goal should be to make full-fiber internet connection available to all free at the point of use as a tax-funded public service. Once the UK’s full-fiber network is complete, public ownership of the infrastructure—rather than by companies organized to maximize shareholder value—can enable connection to be organized based on universal, decommodified connection, with the operating and connecting costs covered through general taxation.
Ensuring accountability and democratic control of digital infrastructures
The extension of democratic ownership should be accompanied by steps to transform the accountability and democratic control of digital infrastructure, including:
- A new digital platform for debating and deciding National and Local digital priorities: With full-fiber guaranteeing equal internet access, an online platform called WeDecide.gov.uk could function as an online space for everyone living in the UK to debate and decide priorities for how digital infrastructures are used.
- Funding and support for community initiatives: Local government should be mandated to provide co-working and maker spaces with 5G broadband infrastructure – either directly or in coordination with other stakeholders – for community business, co-operatives, and employee-owned companies to ensure that these spaces can help these forms of enterprise thrive in the digital age.
- An expanded regulatory framework to monitor fiber-based technologies: The monitoring of and strategy for fiber rollout to ensure equity of access should be mirrored in considerations of the potential harms of the technologies built on top of fiber networks, including invasive surveillance, social control, and environmental damage.
- Digital infrastructure to drive decarbonization: The installation and development of broadband and 5G infrastructure must be planned strategically to support a just transition. The Committee on Climate Change should advise the National Infrastructure Commission on the digital infrastructure needs to reach net-zero rapidly and justly.
A British Digital Cooperative and spectrum for the common good
To build a digital and communicative sphere based on democratic and egalitarian principles over oligarchic surveillance, a British Digital Cooperative should be established. A common property, owned collectively by all residents of the country, the BDC, as set out by Dan Hind, “would be tasked with developing a surveillance-free platform architecture to enable citizens to interact with one another, provide support for publicly funded journalism, and develop resources for social and political communication.”
Building a public cloud infrastructure
With one likely effect of Covid-19 being the consolidation and the reach and power of the universal platforms, the need to challenge the power of ‘Big Tech’ will be more urgent than ever. A critical element of this is their dominance of cloud computing infrastructures, a source of both very significant revenue and infrastructural power over the direction of the economy. First, by requiring major tech companies to separate off their cloud infrastructure businesses and then regulating cloud providers as key public utilities. And second, a public option ‘cloud infrastructure’ should be created and used to host and perhaps process the vast troves of government data that already exist, and that are continually being produced.
This report is produced in collaboration with The Democracy Collaborative as part of the Democratic Public Ownership project. View the full report in pdf form here.
- In These Times: “We Should Own the Internet—Not Silicon Valley Oligarchs”
Table of Contents
- Digital infrastructure policy proposals (United States)
- Digital Infrastructure Policy Proposals (United Kingdom)
Director of Common Wealth more
Director of Research at The Democracy Collaborative more
Director of Research and Advocacy, Common Wealth more