The Future of US Internet: City-Run Broadband, Satellite Web and Subsidies

In Fort Collins, Colorado, residents like Eric Holland have a unique option when signing up for internet service. Instead of being limited to giant providers like Comcast, Charter or Cox, they can opt for a city-owned and operated service, called Connexion.

Holland, a software engineer, heard about Connexion while researching alternatives to Xfinity, after growing tired of rising prices and recurring outages. He was enticed by the 1-, 2- and 10-gigabit speeds the municipal network offered.

"With remote work becoming more popular, it's super important to have a good, stable connection," Holland says. Now, "three of us can be in (Zoom) meetings at the same time."

Connexion's genesis took place about a decade ago, when the city was looking for ways to bring faster, more affordable internet to the community. In November 2017, voters approved a ballot measure to build a municipal fiber network. By 2023, Connexion was available to all homes and businesses in the area.

"In Fort Collins, at least initially, there just wasn't an investment in infrastructure, which means speeds couldn't be experienced as high," says Chad Crager, Connexion's executive director. "I had neighbors that had both of our competitors at their house and paid for it because one would go down and they needed the other." Now, those neighbors, and around 18,000 other residents, rely solely on Connexion.

"It's also caused our competition to lower their prices and really invest in our city," Crager adds.

See also: Affordable Connectivity Program Ending This Month: How You Can Keep Internet Costs Low

Fort Collins is one of many cities pursuing innovative ways to bring more affordable, reliable broadband to communities. In Ammon, Idaho, the local fiber optic network is owned and operated by the city. This has benefitted private internet service providers, too, since they can use that existing infrastructure to enter the market, lowering the barrier for entry and boosting competition (and therefore reducing prices for consumers).

Other cities like Hillsboro, Oregon, have also built their own fiber networks, placing affordability at the forefront. And a handful of tribal nations have started building and running their own networks, too. According to the Institute for Local Self-Reliance, there are now more than 400 active municipal broadband networks in the US.

These initiatives highlight the ways communities are bridging the gaps left by large, private IPSs, whose services can be unaffordable or simply unavailable to many people, especially among rural, low-income and marginalized populations. For many of these communities, municipal and publicly owned networks are the only way to truly get connected.

Traditional internet providers have long dominated the scene, thanks in large part to lobbying and political donations that helped cement their ubiquity across much of the US. But geographical challenges and high costs tend to deter larger providers from building infrastructure in remote and overlooked areas, leaving many communities in the dark.

"Digital equity and inclusion, or the lack thereof, tends to intersect pre-existing marginalized categories," says Chirstopher Ali, Pioneers Chair in Telecommunications and professor of telecommunications at Penn State. "[Broadband is] treated as a consumer good, not as a social and public good. It's not a luxury anymore; it's a utility." 

In that sense, municipal networks seem to be a much-needed solution to an issue that's plagued parts of the US since the internet's rollout. Today, more than 7 million homes and businesses don't have access to high-speed internet, according to the Federal Communications Commission. (For context, that's about the population of the entire state of Washington.) Allowing local leaders to deploy broadband can help expand access by prioritizing digital equity over financial gain. These leaders better understand their community's terrain, both literally and figuratively, and aren't beholden to Wall Street. 

"They work to connect everybody and they are accountable to folks who have been left behind in the private marketplace," says Ry Marcattilio, associate director for research at the Institute for Local Self-Reliance. 

But there are obstacles.

Around two dozen states have laws that ban or restrict cities from building municipal or publicly funded broadband networks. Lobbying by private ISPs has played a significant role in maintaining those restrictions. The argument from lawmakers has been that municipal networks could have an unfair advantage over private companies because of easier and cheaper access to public rights-of-way for building infrastructure. A counterargument is that it's common for different entities to have certain advantages or disadvantages in any market. 

Another concern from lawmakers is that if a municipal business fails, those costs will fall to the state and its taxpayers. 

"But perhaps the better course would be to set up the municipalities for success, particularly given that some of these ventures have proved to be very successful," says Tejas Narechania, professor of law at the University of California, Berkeley. "These bills are sometimes said to 'level the playing field,' but it's not clear they do anything but disadvantage the municipally owned service." 

In May 2023, Colorado repealed a state law requiring local governments (like Fort Collins) to get voter sign-off on building municipal networks. A similar battle continues in other states.

Over the last few years, the Biden administration has pledged to remove those barriers. In early discussions about what ultimately became the Infrastructure Investment and Jobs Act, passed in 2021, the president shared his commitment to "lifting barriers that prevent municipally owned or affiliated providers and rural electric co-ops from competing on an even playing field with private providers." Conversely, GOP leaders recently proposed a nationwide ban on such networks, claiming the move would promote competition by "encouraging private investment." Still, the Biden administration's goal was to invest $100 billion into bringing "affordable, reliable, high-speed broadband to every American."

Following pushback from Republican lawmakers, that $100 billion investment eventually dropped to around $42 billion in funding under the Broadband Equity Access and Deployment Program, or BEAD. The goal of BEAD, which is part of the IIJA, is to "support broadband infrastructure deployment and adoption" across all 50 states and US territories, according to the National Telecommunications and Information Administration, which runs the program. Projects funded through BEAD have to have low-cost broadband service options, as well as affordability plans for middle-class families. But some still worry that initial focus on prioritizing local and nonprofit broadband networks will get lost.

In an interview with CNET, a senior NTIA official said BEAD includes language to ensure it's not just the biggest providers who get funding, but also municipal networks, co-ops and smaller ISPs. The NTIA can ask for modifications if the process for administering funds appears to shut out those smaller competitors, and a federal program officer will work with state broadband offices to oversee and monitor those procedures. 

Ultimately, experts like Raza Panjwani, senior policy counsel at the Open Technology Institute, a branch of the liberal think tank New America, say there needs to be an intentional shift from maintaining the status quo to doing what it takes to get more people online.

"It's going to be important to make sure that we're truly connecting people," says Panjwani, "and not just checking the box." 

The impact of limited broadband access

The COVID-19 pandemic illustrated just how big the digital divide is. In the shift toward remote work and online learning, many had to grapple with a lack of broadband access. 

In 2021, the Federal Communications Commission established the Emergency Broadband Benefit Program (EBB), which gave a discount of up to $50 a month for broadband service to eligible households, and up to $75 a month on tribal lands. At the end of the year, EBB was replaced with the Affordable Connectivity Program, which lowered the monthly benefit to $30 a month on non-tribal lands. The ACP was billed as a "long-term" plan to get more people connected, and more than 23 million households enrolled. Some places, like Albemarle County in Virginia, also have an ACP bridge program, which gives qualifying low-income households up to an additional $20 for broadband service. But the ACP will run out of funding in April, meaning millions of families risk being shut out once again.

"We're not just talking about Netflix and YouTube," Panjwani says. "We're talking about telehealth, we're talking about education, we're talking about the ability to start a business with an online presence." 

In addition to keeping people connected for the purposes of work, school or recreation, there's real economic value to getting more people online. A Deloitte study found that a 10% increase in broadband access in 2014 would have led to around 875,000 more jobs in the US, and $186 billion more in economic output in 2019. 

It's unclear whether the ACP will be renewed by the time funds run out at the end of April. But some say despite the assistance it provides for millions of Americans, it's not enough to solve a much larger, underlying problem. 

"The ACP is great, but essentially, it's a coupon … that tries to solve the problem that the private marketplace has created," Marcattilio says. The solution, he adds, is new infrastructure, which in turn provides customers with more choices and ultimately leads to more connected homes.

Initiatives like the federal Universal Service Fund aim to build out broadband infrastructure and promote access and affordability through FCC programs like Lifeline, which offers low-income consumers a monthly discount on phone and broadband services. There have been calls to reform the USF and how it's funded. Right now, that onus falls on traditional telecommunications companies, as well as cable companies that offer voice services. But because many people don't use landlines anymore, there's been a push to modernize where that money comes from. A bipartisan Senate bill introduced in November would require broadband providers and "edge providers," which includes search engines, social media companies and e-commerce platforms -- in other words, Big Tech -- to chip in, too. 

"We need to make sure that this is not a regressive tax," notes Ali. "Telephone companies have historically passed this tax onto consumers. As we're pushing universal broadband, and … affordability, it's not fair to allow providers to move this tax onto their consumers."

Building broadband for the future

Tech developments can be a step toward improving productivity and connection for some people, but each new wave can also leave others behind. Take AI, for instance. It's shaping everything from how we create to how we work and the ways we communicate. But if millions of people are still struggling to access reliable broadband, they'll fall even further behind. 

Digital literacy programs are crucial to making sure that divide isn't exacerbated. Community organizations like libraries can not only help people get connected to the internet, but also offer courses to inform about AI harms and biases, and to help people leverage emerging tech. Groups like the National Digital Inclusion Alliance work to support digital literacy programs while also pushing for local, state and federal entities to support these efforts. 

"We need to get to where we are no longer addressing digital divides after they happen," says NDIA Executive Director Angela Siefer. "There's a huge opportunity for us to get in front of a digital divide we can see coming at us."

The same goes for upcoming technologies like Wi-Fi 7 or 6G. While faster internet speeds and greater bandwidth can be something to look forward to, the reality is many still lack basic access to a stable connection. 

"Technology is not 'trickle down,'" says Ryan Johnston, senior policy counsel for federal programs at Next Century Cities. "The more you push to the people that have already adopted, it's not going to seep through the cracks to the people that don't have it yet."

In recent years, some, including tech moguls like Elon Musk, have touted the benefits of satellite internet through services like Starlink. But experts maintain expanding fiber internet, which is faster and more reliable than other options like 5G or satellite internet, is key to expanding broadband access. 

"Mobile and satellite internet service will always be a niche. It only works so long as you stay below a certain number of subscribers," Marcattilio says. "We need wired connections that are future-proof, and that means fiber." 

Expanding fiber access, especially at the community level, isn't a far-fetched goal, he adds. 

"We've got this false sense that building and operating internet infrastructure is too complicated or expensive for cities to do," Marcattilio says. "In reality, compared to things like electricity – of which there are almost 2,000 publicly owned systems in the United States, and things like water or wastewater – broadband infrastructure is well within our ability to do."

Fort Collins is proof of that. And as the online world becomes inextricably linked to our everyday lives, it'll only become more critical to expand affordable and reliable broadband access.

"Now more than ever, it really has to be a utility and thought of as that," says Crager, Connexion's executive director. "People depend on it."