Detroit's population was 1.8 million in 1950. Today it's estimated at 916,000, a decline of almost 50%. It would be easy to chalk this up to industrial decline, particularly with the slow death spiral of the American auto industry. But, this decline in urban population is not unique to Detroit. From 1950 to 2000, Chicago declined by 20%. Boston and Philadelphia by 26%. Washington DC by 28%.
Where did everyone go? Data suggests they headed to the burbs. The metropolitan areas surrounding these cities all increased their populations dramatically; ranging from 25% (in Philadelphia) to 178% (in DC.) Sadly, the great migration may be just getting started.
What caused such a decline in urban population? There are likely many reasons, but one of the most credible arguments is that improvements in highway infrastructure and the growth of the automobile resulted in a situation where city-dwellers had more options than ever before. Once a family had a car, it was no longer necessary to live within a stone's throw of a factory or office.
In the 21st century, there's a new highway being built - out of fiber optics instead of asphault and concrete. And while this highway doesn't transport people and goods to stimulate economic activity, it does transport information, ideas and electronic commerce. There is little debate any more about the impact that broadband has on the economic well-being of communities.
Many have compared the evolution of this new broadband highway to the electrification of America in the early 20th century. Jim Baller put it this way:
"[A]t the turn of the last century, when electricity was the great new technology of the age, the private sector focused first on electrifying the major population centers and literally left most of America in the dark. Recognizing that electrification was critical to their economic development and survival, thousands of communities that were not large enough or profitable enough to attract private power companies created their own electric utilities."
While Jim points out important similarities with how rural electrification played out and where broadband is in America today (private providers naturally invest more heavilly in areas that generate higher and more rapid returns), the situation for urban cities is very different. For example, in the early 20th century, suburbs didn't exist (due in part to the points made above about lack of automobiles and highways), so the natural place for private utilities to invest was in urban cities. That's not happening with next-generation broadband systems, namely FTTx. In the world we live in today, fiber starts in the burbs.
Consider this article, which describes the intense activity on New York's Long Island by Verizon and Cablevision to deploy advanced broadband systems. The article notes that "Verizon has rolled out FiOS to most of Long Island."
Now contrast this with the announcement made by Verizon in July that it reached an agreement with the City of New York to deploy FiOS (for television service, but one can assume broadband will be offered concurrently.) When you dig deeper, you find that Verizon has until 2014 to complete the deployment. Sure, New York City is a much larger market than Long Island, and deployment challenges in the burroughs will not be a cake-walk.. but six years?
New York may end up in a better position than most major cities. At least in their case, they've retained the leverage that comes with television franchising authority. Major cities in states where franchising authority has move to the state are more likely to find themselves without a seat at the table, and without the ability to force deployment timelines, prevent redlining and so on.
It may sound like I am arguing that the broadband challenge in major urban markets is greater than what rural communities face. That's because I am. While rural communities do have substantial challenges with georgraphy, terrain, density and so on, they also tend to have more options available to address these challenges. For example:
- Dozens of federal and state grant programs are available for rural broadband. There are no such programs available for urban areas; only grant programs aimed at municipal use and public safety infrastructure.
- Municipal and electric memberships (EMCs) have been pioneers in serving rural communities and regional areas for decades. Many like Glasgow (KY), Bristol (VA) and Blue Ridge Mountain EMC (North GA) provde advanced, triple-play services over fiber systems today. With the exception of Los Angeles, no other major U.S. city owns and operates its own electric utility.
- Competitive entry is stronger in rural and regional areas, due in part to the fact that competitive ISPs find these markets to be less contested than urban centers.
All is certainly not lost for major cities. They can adopt measures to streamline the permitting, right of way and other processes that private providers often point to as slowing their deployments. They can also engage in activities to stimulate demand for advanced services, which most agree will have the indirect benefit of encouraging more private investment. They can also invest in fiber optic "core" systems that deliver on a tangible business case for municipal, public safety and other public use. Unfortunately, many major cities will find their options for public ownership of commercial networks to be more challenging due to the current recession, declining tax revenues, shrinking budgets and human capital resources. It will take enormous courage for a major city to do what none has done so far; take matters into their own hands.
Will stimulting demand, coaxing the private sector and other such tactics be enough to meet the challenge for major cities? Will major cities become "the copper hole in the fiber donut?" Will the collission of telephone, cable and Internet companies be enough for market forces to prevail? Only time will tell it seems, but with America's decline in broadband leadership, the clock is certainly ticking.