The broadband gap's dirty secret: Redlining still exists in digital form
When Christina Wilson moved into Los Angeles public housing with her husband and teenage daughter four years ago, she tried to transfer her internet service plan to her new home. But, as is the case with many low-income communities in the US, the ISP didn't serve the Housing Authority of Los Angeles' Imperial Courts. In fact, no internet service providers offered speedy plans for any of LA's public housing facilities. Instead, they only offered pricey, slow plans insufficient for today's needs.
So the 45-year-old relied on her smartphone's T-Mobile connection for anything she wanted to do online, while her daughter used her phone as a hotspot to attend her virtual film school classes. The mobile devices had unlimited data but came with caveats.
"What we found out with unlimited data is it's still limited because they slow your internet down," Wilson said. "If my daughter's online, doing school, it's terrible waiting all that time."
The gap in broadband coverage in a poorer neighborhood is effectively a digital form of redlining, a now-banned practice that denied service based on race. In the 1930s, banks started developing maps to withhold loans for high-risk, "undesirable inhabitant types," who were almost always poor people of color. The redlining extended to a refusal to insure residents in low-income neighborhoods, denial of health care and decisions not to build essential facilities like supermarkets. Even Amazon has been accused of not serving poor, predominantly Black neighborhoods with its Prime same-day shipping plan.
The decades of redlining represent a form of systematic racism that has denied generations of Black communities the kind of opportunities many other Americans enjoy. And the fear is it's happening again with broadband internet service. Big providers, when deciding where to invest the money to upgrade their networks, often focus on wealthier parts of cities and shun low-income communities. Fiber connections are expensive, and ISPs are hesitant to expand unless they expect a return on their investment. As a result, poorer communities often have no internet or are stuck with slow, legacy networks that can't meet today's demands -- even though they usually pay as much as their wealthier neighbors who have gigabit fiber connections.
Digital redlining isn't illegal since there aren't regulations that dictate where broadband providers build their networks. But those desirable areas are often affluent, predominantly white communities. Conversely, areas where income is lower tend to be in Black and Hispanic neighborhoods, intrinsically tying this issue to race, consumer advocates say. It's because of those complexities that it's difficult to truly gauge the magnitude of the problem.
"Is it intentionally race?" said Angela Siefer, executive director of the National Digital Inclusion Alliance, a nonprofit that advocates for low-income communities to get access to technology. "One doesn't know intentions. But one knows the outcome, which is the majority of the neighborhoods that have slower speeds from providers ... are lower-income neighborhoods, and they tend to be communities of color."
The number of people caught in the broadband gap overall is staggering. Microsoft, which tracks how quickly people download its software and security updates, estimates 120.4 million people, or more than a third of the US population, don't use the internet at broadband speeds. The problem has jumped in importance as the novel coronavirus pandemic has made home broadband essential. Without it, people can't attend classes, work, virtually visit their doctors or even easily schedule appointments for COVID-19 vaccinations. The fear is digital redlining will continue as wireless carriers roll out 5G networks across the country.
There's no data about the nationwide prevalence of digital redlining, but studies have found the practice taking place in cities like Baltimore, Cleveland, Dallas, Detroit, Los Angeles, Oakland and other parts of California. NDIA's annual analysis of the "worst connected cities in America" for 2019, the most recent data available, showed that the top 20 cities with the least access to broadband -- including mobile -- all had poverty rates of at least 10%, while all but two had high percentages of people of color. Meanwhile, the Greenlining Institute last year mapped out Internet accessibility throughout California and found that areas that were redlined by banks in the past are digitally redlined by ISPs today.
Lack of high-speed home internet access disproportionately affects children of color, according to a joint study last year from the Alliance for Excellent Education, National Indian Education Association, National Urban League and UnidosUS. It found that 34% of American Indian/Alaska Native families and about 31% each of Black and Latino families lack access to high-speed home internet, versus 21% of white families. That raises the risk these kids will fall behind their peers.
There is hope the situation will change. In his $2 trillion infrastructure plan unveiled in April, President Joe Biden initially pledged $100 billion over eight years to make sure every American has broadband access. (The amount was later lowered to $65 billion to match a Republican proposal). Affordability will be a big part of that, and the funds could incentivize companies to build in areas they previously avoided. They could also tempt upstart competitors to serve the neighborhoods. Biden tapped Vice President Kamala Harris -- who is Black, Asian American and an Oakland native -- to oversee the country's efforts to close the digital divide.
To directly address affordability, the federal government in mid-May introduced a $50 Emergency Broadband Benefit to get people online during the pandemic, a model that could be followed through future broadband plans. It also has provided funding to get internet access to more students. Like the Biden administration, the US Federal Communications Commission, led by Acting Chairwoman Jessica Rosenworcel, has made broadband access and affordability key areas to tackle.
In the meantime, state and local governments, along with nonprofits, low-cost internet providers and other organizations, are finding ways to bring internet access to underserved communities. In cities like Los Angeles and Denver, budget ISPs such as Starry have built networks to provide $15 monthly internet service in public housing. In East Cleveland, nonprofit PCs for People has partnered with the state, Microsoft and various other businesses to offer inexpensive internet plans and computers to 2,000 residents, while another nonprofit, DigitalC, which has ambitious plans to connect 40,000 people in the city by 2025. Similar programs are happening all over the country.
At a time when people are so divided, this is a rare issue that crosses political lines.
"If somebody else solved this problem for me, I would love it," said Jon Husted, the Republican lieutenant governor of Ohio who also runs InnovateOhio, the state's effort to improve technology access for its citizens. "It's not like I have a secret desire to run a government-run internet service provider. I'm just trying to solve a problem for real people that nobody else is."
The origins of redlining
Redlining was aimed at protecting the bottom lines of banks, insurers and other companies when it emerged in the last century. The groups defended the practice as avoiding "risky" investments, but the definition of risk often was based on race. The policy resulted in entire communities -- a vast majority Black -- being denied loans, coverage or service.
While the Fair Housing Act in 1968 made redlining illegal, the effects still linger for Black communities. In the US, home ownership has long been a major factor in determining a person's financial stability and a way for families to pass on wealth to future generations. In 2019, only about 42% of Black people owned homes versus 72% of white Americans, according to the Urban Institute, and the median Black household held one-eighth the wealth of the median white household. At the same time, historically redlined neighborhoods have "lower life expectancy and higher incidence of chronic diseases that are risk factors for poor outcomes from COVID-19," according to a study from the National Community Reinvestment Coalition.
Redlining "created Black poverty," said Juan Perea, a professor of law and social justice at the Loyola University Chicago School of Law and an expert on the history of racism in the US. "Black poverty has been devastating on equal schools, on equal housing, on equal health conditions, on equal employment possibilities."
Digital redlining is similar to traditional redlining, though it isn't based outright on race. Instead, it's based on income and corporate calculations on whether building service in a particular neighborhood or city will be profitable.
Internet service in the US is considered a free market service, not a utility like electricity, gas or landline phone service. While ISPs build networks where it makes financial sense and set their own prices, utilities face price caps, coverage requirements and other regulations to make them accessible for everyone.
While ISPs aren't openly shunning build-outs in areas because of the ethnic breakdown of a community, they are weighing the money they'll make from installing pricey infrastructure. Often, they determine they won't make much -- if any -- profit in low-income areas, so they decide not to invest there. It turns out, many of the areas redlined by banks decades ago have trouble getting high-speed internet service today. A modern-day map of households in Cleveland without broadband internet access mirrors a 1940s map of mortgage redlining in the city.
A map of 1940s mortgage redlining in Cleveland closely aligns with a modern-day map of areas of Cleveland without fast internet service. The "undesirable" areas marked in red on the bank map match areas on the broadband map where at least 40% of the households lack broadband. (Use the slider to see both views.) The mortgage map is based on an image shared by Ohio State University, while the broadband map is from DigitalC and EmpowerCLE+ and uses data from the 2015 to 2019 American Community Survey.
"Digital redlining is the system working as it was designed," said Vinhcent Le, technology equity legal counsel at the Greenlining Institute. "How it should have been designed is the internet is a utility. At the end of the day, that's the only surefire way to get out of this. At the same time, it's probably one of the least likely ways given the amount of money involved."
The origins of digital redlining stem from a system that was designed to make sure everyone had telephone access. Landline telecom companies were required to provide inexpensive, fixed-line phone service to all homes in the US. Many of those companies then became the first internet service providers, providing connectivity through dial-up connections and later through "digital subscriber lines" via copper cables. DSL, as it's more commonly known, was considered speedy in the 1990s before it was supplanted by faster cable broadband.
Now, DSL speeds typically range from 0.5 Mbps -- too slow to do most tasks on the internet -- to about 100 Mbps, if the user is close to the main hub. Because most DSL connections can't keep up with today's internet needs, companies no longer invest in those networks and are instead building fiber or fixed wireless to serve their customers and future-proof their networks. But some providers are only replacing DSL with pricey fiber in wealthier areas where they know their investment will pay off.
The big, publicly traded service providers generally expect to make a return on their investments in about three to five years, said Ernesto Falcon, senior legislative counsel at the Electronic Frontier Foundation.
"That's basically impossible with this high-capacity infrastructure for a vast majority of places," he said. "Some places [like rural communities] may take upwards of 30 to 40 years to repay the debt and make it work." In areas with about 1,000 people per square mile, ISPs should be able to make money in the long run, Falcon estimated. "It just doesn't make money fast enough for their liking," he said.
While digital redlining isn't identical to traditional redlining, it could have some of the same impacts over the long term. Kids who can't take classes from home may never catch up to their more affluent peers, get into good colleges and find high-paying work. Adults without fast broadband can't participate in the modern economy -- completing tasks like paying bills online, video chatting with their doctors remotely, or searching and applying for jobs. They're often limited to what they can do on their phones, which experts say isn't a real replacement for a wired connection.
To ensure that everyone has broadband internet service, some organizations have proposed using Title II of the 1934 Communications Act to reclassify broadband as a telecommunications service, the same step taken by the FCC in 2015. At that time, the FCC adopted net neutrality and said it would be able to regulate broadband under the rules used for the old telephone network. The move made broadband a "common carrier," which meant the network had to be open to everyone. One of the first major moves by Ajit Pai after his appointment as FCC chairman by President Donald Trump in 2017 was reversing net neutrality rules and deregulating broadband. The current FCC can seek to reverse the reversal, but first, Biden will have to appoint a fifth, tiebreaker commissioner.
Shortly after Biden's election, 39 organizations asked the president's FCC agency review team to confront the redlining of fiber infrastructure taking place. Separately, three Baltimore city council members -- along with 100 other elected officials and organizations around the country -- sent a letter in March to Rosenworcel asking her to launch a commission focused on ending digital redlining, as well as to reclassify broadband under Title II authority.
"We demand that the new Biden FCC commit to abolishing digital redlining in its first year and use its power to end digital redlining of fiber infrastructure in its entirety across America before the end of the first term," said the November letter to Biden, which was signed by groups such as the California LGBT Arts Alliance, the Detroit Community Technology Project and the DC-based advocacy group Public Knowledge.
Enacting Title II wouldn't just bring back net neutrality. It also could let the FCC regulate the broadband industry in a similar way to utilities, including protecting consumers and ensuring service quality. It could be able to ensure service providers offer affordable plans and require those plans to cover everyone, not select, wealthy parts of a network. Whether it will actually do that would take a lot of heavy political lifting. When passing net neutrality in 2015, the FCC didn't adopt some aspects of Title II, like setting price caps on broadband service.
But if broadband is redefined as a utility, it could help places like the Housing Authority in LA make internet access even more affordable for residents.
For much of the pandemic, students in California have taken classes remotely. But at least one group struggled -- children who live in LA's public housing. The approximate 6,900 units house about 23,000 Angelenos, but until last summer, the residents had no wired, fast, reliable internet service in their apartments.
"Most of our sites were not really covered by anyone," said Jenny Scanlin, chief development officer for HACLA. "They were theoretically covered by a number of broadband providers, but the broadband providers would not invest in the infrastructure needed to actually bring and distribute that internet on site. Even though some people were paying for services, they were spotty to say the least and fairly useless."
A 2019 study on broadband in LA County from the University of Southern California's Annenberg Research Network on International Communication found that competition and fiber internet service are less likely to be found in low-income areas and communities of color, particularly in areas that combine poverty and a large percentage of Black residents. Gigabit-level broadband service is "significantly more available in wealthier communities," the study said. And there's more competition in affluent areas, giving consumers in those areas more choice and better prices for faster speeds.
"There are significant differences in what happened then [with mortgage redlining] and what's happening now," said Hernan Galperin, an associate professor at USC's Annenberg School for Communication and one of the study's authors. "But you could argue that ultimately the result is the same."
The situation in LA's public housing started changing when Starry wanted to put its broadband internet towers on the roofs of HACLA housing. Its low-cost, digital equity arm, Starry Connect, ended up signing a deal with the housing authority to provide fixed wireless, 30Mbps symmetrical service to over 5,000 units across nine different public housing sites. Instead of tying service to an individual -- which traditionally has required ISPs to perform credit and background checks -- Starry provides service based on an address. After a six-month free trial during the initial launch period, the service costs $15 a month. Starry so far has covered about 1,000 units.
"The vast majority of those folks that participate in ... our program probably don't actually know that they're a part of an affordability program," said Virginia Lam Abrams, Starry's senior vice president of government affairs and strategic advancement. "It was really purpose-built that way ... to really reduce the friction [to] adopting broadband … [and] there's a lot to be said about preserving people's dignity."
While $15 a month may be reasonable for many people, it's still too expensive for those who have no income. That's where classifying internet service like a utility could help. The US Department of Housing and Urban Development, which funds HACLA and other housing authorities across the country, doesn't allow those organizations to cover the cost of internet service for residents -- yet. There's hope that officially defining internet service as a utility would allow residents to deduct the cost of their internet service from their rent, such as what they do for utilities like gas and electricity.
"Frankly, I think that this should be treated as a utility," Scanlin said. "It should be something that is required to be provided."
Currently, HUD allows housing authorities to use operating funds to pay for internet service in common areas, computer rooms and individual units -- but won't cover service used for "entertainment." The Coronavirus Aid, Relief, and Economic Security (CARES) Act also allowed HUD funds to be used to cover in-unit internet service for families with significant telehealth needs, kids attending remote classes, or disabled and elderly people who couldn't leave their homes.
HUD is exploring how it could do more. Providing a utility allowance for internet service for public housing residents would take, at the very least, regulatory action. To extend benefits to lower income families participating in other HUD programs, like its housing vouchers program, likely would require an act of Congress.
"Because the Biden-Harris administration understands how vital internet connectivity is to daily living, HUD is exploring options to make home internet service more accessible for the families we serve through the public housing program and across the department's other programs for low-income housing," said a HUD senior official.
ISPs argue that it doesn't make sense for internet to be a utility. They say the industry is "ultra-competitive," in the words of trade group USTelecom-The Broadband Association, and is defined by ever higher speeds, plenty of capacity, new providers and next-generation technologies. USTelecom lobbies on behalf of companies like AT&T, Frontier, Verizon and Cisco. Broadband providers have invested $1.8 trillion over the past 25 years to build infrastructure around the country, said USTelecom CEO Jonathan Spalter, and ISPs argue such investment wouldn't be possible if companies couldn't make money from providing service.
"Broadband deployment is hard and capital intensive work, but broadband providers in every corner of the country -- from local Main Street companies to global technology leaders -- are investing nearly $80 billion annually to connect communities, upgrade infrastructure, bolster speeds and innovate across their networks," Spalter said in a statement.
"Let's be clear: all communities in the United States should have access to the power and promise of broadband -- no matter where, no matter what," Spalter added. "Full stop. Systematically excluding anyone from 21st century connectivity is wrong."
Suing for equal coverage
Even though internet service isn't regulated like a utility, companies can still be accused of denying coverage or discrimination. The biggest offenders tend to be the former landline service providers such as AT&T and Frontier Communications, not cable companies, experts say. Because of franchise agreements, cable providers are barred from offering internet service to people in some areas and ignoring others.
"Cable broadband service absolutely does not redline and builds out and upgrades its networks throughout entire cities, including inner city areas," Brian Dietz, a spokesman for NCTA-The Internet & Television Association, said in a statement. The group, formerly known as the National Cable & Telecommunications Association, represents the country's biggest cable providers like Comcast, and it's one of the most influential lobbying groups in America. "These franchises have been in place for decades in most communities across the US," he added.
In 2017, citizens of Cleveland filed an FCC complaint against AT&T, accusing the wireless carrier and home internet service provider of "failing to serve the low-income, communities of color" in the city. A similar complaint was filed later that year by residents of Detroit. Both relied on research from NDIA that pulled data from AT&T's FCC filings. In the case of Cleveland, "the overwhelming majority of [census] blocks with individual poverty rates above 35%" lacked fast AT&T fiber-to-the-node internet, while the technology was the standard in Cleveland's wealthier suburbs. In Detroit, a similar pattern emerged, NDIA said. AT&T disputed the findings, and both complaints were "resolved" through "commission-staff supervised mediation" and dismissed in early 2018.
"We do not 'redline' internet access, and any suggestion that we do is wrong," AT&T spokesman Jim Kimberly said in a statement. "Our investment decisions are based on the capacity needs of our network and demand for our services. So called 'studies' from ideologically driven groups like NDIA skew antiquated, inaccurate and cherry-picked data to formulate desired conclusions."
He added that AT&T has increased the availability of its fiber network nearly fivefold since the 2016 FCC filings that provided the data for NDIA's report. As of the end of the first quarter, AT&T Fiber covered more than 14.5 million customer locations in over 90 areas, and the company plans to double the number of customer locations by the end of 2025.
Still, an October 2020 report from NDIA and the Communications Workers of America -- based on FCC data from 2019 -- found that AT&T has made fiber-to-the-home available to fewer than a third of the households in its footprint. It also said that households with AT&T Fiber available have a median income 34% higher than those with DSL only.
Meanwhile, an examination of Frontier Communications' bankruptcy filing by the EFF a year ago found that Frontier hadn't upgraded its old DSL network because it was making money from customers paying for those slow speeds. Had it invested in fiber, it would have lost money for about five years, the EFF calculated.
Part of Frontier's plan to emerge from bankruptcy, which it outlined in April, is to accelerate its fiber build-out. It aims to pass an additional 3 million homes and businesses with fiber over multiple years, bringing its total footprint to 6 million. That includes extending fiber to nearly 500,000 more residences this year. Upgrading about 3 million DSL users will deliver a 20% internal rate of return on its investment by 2031, Frontier said in a regulatory filing.
"Fiber has high upfront costs (like a house), but it pays off handsomely over time," the EFF said. "The inability to capitalize on superior investment opportunities because they take too long to mature is the very definition of dysfunctional short-termism."
The US Federal Trade Commission and law enforcement agencies from six states sued Frontier in May for failing to deliver DSL internet speeds that consumers paid for and were promised. The complaint alleges that Frontier charged many consumers for more expensive and higher-speed service than it actually provided. Frontier provides DSL service to about 1.3 million subscribers, many in rural areas, across 25 states.
At the time, Frontier said in a statement that the lawsuit is "without merit" and that its "DSL Internet speeds have been clearly and accurately articulated, defined and described in the company's marketing materials and disclosures." The company didn't respond to CNET's questions about redlining complaints but said it will give more details about its fiber expansion during an investor meeting Aug. 5.
New York sued Verizon in 2017 for failing to live up to its promise to install fiber to every home in the city by 2014. The deal was reached in 2008 as part of a citywide cable television franchise agreement, but by the time of the lawsuit, Verizon had installed fiber in about two-thirds of New York's 3.1 million residences. Most unserved homes were in low-income parts of the city. New York and Verizon settled their dispute in November, with Verizon saying it will wire up to 500,000 more households with Fios, particularly in the ignored low-income neighborhoods.
"Internet access is an economic right in New York City, no matter your ZIP code," Mayor Bill de Blasio said in a press release announcing the settlement. "Tech giants will not stand in our way to deliver high-quality broadband to New Yorkers -- they must be a part of the solution."
Verizon said it's "grateful for the opportunity to bring Verizon Fios service" to more New Yorkers. "The NYC agreement builds upon Verizon's base and will make this premier broadband service available to even more consumers," spokeswoman Adria Tomaszewski said in a statement.
Meanwhile, the State of New York has gone further with trying to make broadband affordable for residents. In April, it passed a law that will require all ISPs to offer high-speed internet plans to low-income families for $15 a month starting in mid-June. Internet providers are battling the law in court, though, and the rollout plans are on hold.
Giving consumers choice
Six years ago, Denver looked a lot like LA when it came to internet service in public housing. No broadband providers served the 26,000 residents across 21 properties, one of the biggest public housing communities in the Western US. The median household income for the residents is around $10,000 a year, making most internet plans out of reach, even if the units were wired for service. More than 90% of the residents are people of color.
"I just find this shocking, and every time I say it out loud, it feels like I'm talking about 1983 or something," Jesse Burne, strategic initiatives manager at the Denver Housing Authority, said of the lack of broadband in the city's public housing.
Then Denver became a pilot participant in President Barack Obama's ConnectHome initiative, which aimed to expand broadband to more families across the country. Through that program and other efforts, Denver's public housing properties went from zero ISPs to three, giving residents more choice than most Americans across the country. The providers include Comcast with its Internet Essentials program, Starry Connect and LiveWireNet, a local ISP. None charges more than $15 a month, including taxes and fees.
While some organizations and housing authorities have pushed for the internet to be defined as a utility, others view competition as the way to get lower prices and better service -- though competition alone likely won't solve the digital redlining problem. According to an August report from the Institute for Local Self-Reliance, most Americans don't have real choice in internet providers. At least 83.3 million Americans can only access broadband through a single ISP, the study said.
"We don't see just one internet provider as suitable for our residents," Burne said. "They're just like all the rest of us -- they want choice."
The success of the three ISPs in Denver public housing has prompted other big internet providers to approach the units to offer service to residents, Burne said. But they can't come close to the $15 -- or less -- monthly rate the residents are paying.
"The problem is that they don't really understand their audience," Burne said. "They don't understand that they're talking to someone sitting across from them [who] makes $10,000 a year, and they're trying to sell them a $150 internet package."
In Denver's public housing, at least, competition wins. In other places, it may take changes in federal and state funding eligibility to allow new providers to address areas considered "covered" by an incumbent, which typically neglects an area but vows to change when it sees a competitor eyeing its turf (See: Google Fiber). Some municipalities may build service for residents or find ways to fund nonprofits that can provide broadband, like PCs for People in Cleveland. And those billions of dollars in federal infrastructure funding may be better targeted at inner cities and areas previously deemed ineligible for help. Much of the last four years of government broadband spending was aimed at rural communities.
"We know connectivity gaps remain in parts of America, and it is unacceptable," USTelecom's Spalter said. "But private investment alone can't finish the job of connecting every home and business -- that's why this is an important and pivotal moment in Washington."
LA's public housing doesn't yet have competition, but at least it has coverage. In late 2020, Starry Connect made its way to HACLA resident Wilson's home in Imperial Courts.
"They came around and knocked on doors," Wilson said. In the time she's had service, Wilson no longer uses her phone as a hotspot and is able to work as an independent consultant for Paparazzi Accessories, selling jewelry from the company online.
"I feel like $15 is really affordable, especially when it comes to the speed of it," said Wilson, who started paying for her service this month after her six-month free trial. "And it definitely has worked. We're online right now watching TikTok videos."
Correction, Aug. 30: This story initially misstated what public housing authorities could cover in terms of internet service. They can cover in-unit service that's not related to entertainment.