Tanzina Vega: You're listening to The Takeaway. I'm Tanzina Vega. According to an FCC broadband progress report about 19 million Americans do not have access to broadband internet at home and 14.5 million of those Americans live in rural communities. To combat this digital divide, the Federal Communications Commission announced $9.2 billion would be given to hundreds of internet providers to help bring faster internet to rural areas.
Joining me now to talk about the FCC's latest announcement is Makena Kelly, a politics reporter with The Verge. Makena, thanks for being with us.
Makena Kelly: Hey, it's great to be here.
Tanzina: When it comes to rural America, which regions and communities are most effected by the digital divide?
Makena: Right. It's all across the country. It's people from Maine to Texas, to Iowa and California. It really touches basically every state in the country.
Tanzina: Makena, when it comes to the digital divide, particularly in rural communities across the country, what is leading to that? What's contributing to the lack of internet access? Is it structural?
Makena: It really comes down to the fact that it costs so much money for telecom providers, or they say so at least, to put up any infrastructure to connect people. When I was in Iowa, in February, covering the digital divide, I was talking to telecom providers who were telling me they could lay down a mile of fiber and only connect one family and connecting a mile fiber can cost thousands and thousands of dollars when you're only supposed to charge a family, maybe $60 a month for internet. The problem here is that they don't make the return on investment.
Tanzina: How has the pandemic made this issue even more intense?
Makena: It touches everyone who's not connected right now. If you are able to work from home, but you don't have internet at home, that's stripped away from you. Children all across the country, if they don't have Chromebooks, if they don't have internet at home, it really shows the divide there for families. The pandemic has really just shown a light on all the disparity that there always has been, but just made it more apparent for some folks.
Tanzina: The FCC is going to spend $9.2 billion to help rural communities get access to the internet, but they're not giving it to community members themselves, right?
Makena: Right. The way that a lot of the programs that the FCC works and how they send a lot of subsidy money to get people connected to the internet and just getting money to telecom providers to put up infrastructure later, it works through an auction process. The money goes directly to telecom providers who will then put up towers or lay fiber or do whatever they decide to do with it in order to get people connected.
Tanzina: Makena, a couple of things happening now. This Trump administration is winding down. The FCC head Ajit Pai is supposedly stepping down at the end of Trump's term, which is in January. Who's up next?
Makena: We don't really know who Biden plans to appoint as the next chairperson of the FCC. That hasn't been announced yet but we do know who the next Republican commissioner is going to be because he was confirmed this week by the Senate. His name is Nathan Simington and he was nominated earlier this year by Trump.
Tanzina: Can Simington be confirmed prior to a Biden administration and if so, what would that mean for the Biden administration?
Makena: Simington was confirmed. The thing here is that he can be. Donald Trump is still the president. The Senate can still act on nominations, but it is untraditional in the way that it happened this week. The past couple nominations to the FCC, the Senate has paired Democrats and Republicans together. That way the commission gets both Democrats and Republicans at the same time. This week, they just voted on one Republican, which caused a lot of Democrats and advocacy groups to get really upset.
Tanzina: Makena, does the Biden administration have a vision for what its FCC would be?
Makena: They haven't said a lot, but from what I've gathered throughout the past two years throughout the campaign, and now, it's that, of course, everyone's thinking about closing the digital divide, getting people connected to the internet. Another big thing for the past, oh my gosh, 10 years now has been the net neutrality issue. I have a feeling that as soon as the Biden FCC is able to act on it, they will probably move forward with putting net neutrality back on the table.
Tanzina: Some other big news coming out of Washington, the Federal Trade Commission, and dozens of states have sued Facebook with two antitrust lawsuits. Tell us about how significant these lawsuits are?
Makena: It's really significant. Yesterday when this happened, the first thing that I thought about was an old sediment with Facebook that the FTC had about two years ago, or they decided not to pursue litigation. Now two years later, they're deciding to hopefully strip away Facebook's two largest acquisitions of Instagram and WhatsApp.
Just putting that in writing and asking a court to do that is major. For a lot of folks in the antitrust and tech policy world, that seems like pie in the sky reversing those two big purchases Facebook made, but the FTC is really going after it.
Tanzina: What I think, Makena, is interesting is that Facebook's response was that the federal government had the opportunity to voice these concerns and to prevent this from happening almost a decade ago and so in many ways, I wonder if this is a reflection of the federal government's inability to understand what was happening before they allowed Facebook to acquire Instagram and WhatsApp, because it almost seems like "Why now?" is the big question.
Makena: That's one of the things that's really important here. You're 100% correct. Over the past couple of years, Congress has been coming up with plans to make the FTC stronger, to educate, put some rules of the road when it comes to tech companies and the acquisitions they're supposed to be making. It seems like in the past, nobody really understood Silicon Valley, no one really understood the tech economy, the way that it's developed today. They're hoping to look back and correct what they think are mistakes that they've made and next year--
Tanzina: Is that Facebook's fault, Makena, or is that the federal government's fault? To Facebook's point, they did have the opportunity to-- they're going back to try and correct something that could set a precedent for how other tech companies and other companies, I guess, decide to make acquisitions.
Makena: I think you're onto it. The government definitely has definitely had a problem with this. They have been really slow to catch up to the tech economy. We've seen this with data privacy legislation. We've seen this with antitrust legislation and we've seen this with surveillance legislation, we've seen this-- The Congress and the federal government has just been incredibly slow to the tech economy.
It's hard to blame Facebook, but when you look at investigations that Congress has made into Facebook and its acquisitions, it's pretty clear, when you get the documents, that there was a lot of things that could be challenged in court that really does look bad on Facebook. Say, emails from like Instagram folks saying that if Facebook doesn't buy them, Mark's going to go wild, Mark Zuckerberg, some vague threats. It'll be interesting to see all of this play out. It'll be a long case and an interesting one, if it goes forward.
Tanzina: Makena, what's really at issue here. Let's talk about what the federal government is concerned about. Is it just a monopoly power that Facebook could have in tech? Or is it about privacy? Is it about the fact that users who are on Facebook and Instagram and WhatsApp may not know that those three companies are all connected? What's really at issue?
Makena: With the FTC, it seems like the biggest issue that they're pointing out here is the power that Facebook has in the market. The thing with antitrust law is that it's bigger than monopolies. It's consumer welfare. It has to do with other things like that. Of course, in these cases, I'm sure privacy will be brought up, but the main sticking point for both the states and the FTC right here is the fact that Facebook is just so large and consuming so much of, probably both the ad market and the social media tech market.
Tanzina: Makena Kelly, is a politics reporter with The Verge. Makena, thanks so much for being with us.
Makena: It was great to be here.
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