Demand-Side Programs to Stimulate Adoption of Broadband: What Works?

Abstract

The purpose of this report is to examine the evidence available on the degree to which demand-side programs intended to stimulate broadband adoption have been demonstrated to fulfill their purpose. Our focus is on quantitative evaluations that seek to measure the causal impact of a program or initiative on the adoption of broadband. This report is not a compendium of every initiative ever tried to stimulate demand for broadband, but does cover every useful attempt at program evaluation we could find in the area of broadband adoption. We begin by discussing the several general types of initiatives and programs designed to stimulate broadband demand that are extant. We next review studies that have attempted to measure the results of such programs.

After reviewing the evidence, we discuss our overall findings and give suggestions for “best practice” (or, at least, “better practice”) for future program evaluation that may be performed as part of the National Broadband Plan. Given the multiplicity of barriers to broadband adoption, we find that a successful program must tackle many goals. Encouraging broadband adoption is only part of a larger digital literacy effort, and programs work when they make non-users want to connect, make the Internet cheaper and easier to use, and adjust to users’ preferences. There are strengths and weaknesses with both local and national approaches to stimulating broadband adoption. When local governments or community organizations are involved, they typically begin with a more complete knowledge of what the barriers to adoption are in the community. Local organizations may also be more effective at ensuring that programs are actually utilized by the intended recipients. Nationally coordinated efforts may have more capability to set up programs in such a way that they can be evaluated effectively and to collect and analyze data.

Our suggestions are to include cost-benefit analysis as a standard part of program review, and to make clear that the purpose of evaluation is to assess progress made toward the ultimate policy goals (rather than the program’s proximate implementation goals). The collection of appropriate data from which conclusions can be drawn is vital. We close by discussing the need to use appropriate statistical methods to determine the causal impacts of a program, which may require use of econometric or other quantitative techniques.

Keywords: internet, broadband stimulus, community technology center, digital inclusion

JEL Classification: C80, R22, I18, I38, L96, B41, O33