Two Telecom Mergers, One Digital Divide

Submitted by Kevin Cronin on Thu, 10/20/2005 - 12:21.

The Ohio Community Computing Center Network, the umbrella organization for free public computer centers and teaching centers, has provided testimony to the Public Utilities Commission of Ohio stating that the SBC/AT&T Merger and the Verizon/MCI Merger are not in the best interests of the public.   The following is a summary, raising the concern that further telecom consolidation will reduce vital high-speed Internet opportunities for low-income urban and rural areas.  Today, high-speed Internet is critical for education, work and other activities of daily life.  While technological advances in more robust networks, immense Internet speed and additional services are exciting, if only a portion of spciety can participate in yet another technological evolution, Ohio will again be left struggling.  The testimony called for efforts to reduce the divide that finds low-income and rural communities with lower levels of broadband access and an end to telecom efforts to limit the rights of cities to invest in broadband services directly, on behalf of their residents.

The Issue: DSL is not available in all areas. Companies will roll out services where they expect to make the highest profit. This is understandable. But then society is left with an unbalanced availability of basic services. Broadband has become a basic service. The digital divide used to be defined as a lack of access to computers, the definition then changed to include a lack of access to the Internet, then more precisely a lack of access to broadband. Websites with a picture (that is, most websites) are time consuming to download. Even government sites including the IRS and the State of Ohio are difficult to fully utilize without broadband access. As more and more government functions begin to migrate on-line (including job applications and legal filings), the ability to work quickly on-line becomes more and more important.

The Research: Dr. Mary Stansbury <>, Associate Professor in the School of Library and Information Science at Kent State University, analyzed data for Ohio counties using the FCC form 477 results and the U.S. Census Bureau. In Dr. Stansbury’s testimony to the PUCO filed July 8, 2005, she summarizes the results of her analysis,

Looking at the picture of broadband penetration in Ohio, we find that of the 22 poorest counties in Ohio, 13 of them have low broadband activity. And of the 22 counties with the lowest density, 12 of them also have low broadband activity. In contrast, for the most affluent counties, those in the 25th percentile of persons living below poverty, only two counties – Williams and Defiance, have a relatively high percentage of zip codes with no broadband activity. Ohio’s data, when compared to national trends in the Digital Divide, indicates that those without resources are truly disengaged from our digital world.

The Mergers: The question as defined by the Public Utilities Commission of Ohio is whether the merger of SBC with AT&T and the merger of Verizon with MCI promote the public convenience. The Ohio Community Computing Network is emphatically stating no. OCCN is concerned the Companies will have less interest in rolling out DSL to low-income and rural areas. SBC has defined Project Lightspeed as a service that will be facilitated by the merger.

The goal for SBC’s Project Light speed is “to cover nearly 90% of high value customers”.  SBC has not defined a “high value customer” but it is reasonable to assume low and moderate income Ohioans are not “high value customers”. SBC intends to cover 70% of medium value customers and 5% of low value customers. As a for profit company, this is understandable. As the largest telephone company in Ohio providing broadband service, focusing a new technology on “high value customers” is unacceptable.  If SBC’s Project Light speed successfully claims 90% of high value customers, 70% of medium value customers and only 5% of low value customers, the digital divide will be exacerbated.

OCCN and the experts recruited by OCCN provided recommendations regarding community technology to the Coalition, led by the Ohio Consumers Council, to include in the official “proposed conditions”. The core argument is that the mergers should only be approved if proposed conditions are met.

OCCN Goals:  The OCCN testimony and the testimony provided by experts recruited by OCCN provided the basis for the digital divide related proposed conditions for the SBC/AT&T Merger and the Verizon/MCI merger:

* The Telecommunications Company make stand alone DSL available to consumers without also purchasing wireline voice service.

* Should not participate in efforts to restrict Ohio municipalities from investing in broadband networks.

* Universally deploy broadband capabilities throughout the Telecommunications Company’s region within three years. These capabilities should be deployed in a way that guarantees that low-income urban and rural communities will have access to such networks at the same time that wealthier communities have such access.

* Extend the concept of Lifeline telephone service to include a DSL option. A Lifeline eligible household should be able to maintain integrated telephone and DSL service for no more than $25 per month.

* Make small non-profit organizations (e.g. less than 5 employees) and microenterprises eligible for substantial discounts for broadband options such as single line modem with dynamic IP for their business locations.

* A percentage of the cost savings from the merger synergies should be devoted to overcoming the digital divide by funding new and existing Community Technology Centers in the Telecommunications Company’s service territory.

* The Telecommunications Company should establish a substantial ongoing program of financial and technical support for nonprofit community efforts to share advance network services among multiple low-income residences including but not limited to wireless community networks.
Who is OCCN: The Ohio Community Computing Network is a statewide member-driven organization supporting the efforts of community technology service providers to promote full participation in a digital world. OCCN Executive Director, Angela Stuber, can be reached at:

OCCN - Ohio Community Computing Network (
274 E. First Avenue

Columbus, Ohio 43201
Phone: 614-644-6932  fax: 614-728-3521