One of the truly bipartisan efforts in Washington is that of building rural broadband capabilities. Every couple of years, and often wrapped in other large spending packages, the government finds ways to commit more to investing in infrastructure that could truly change the way business is done across the nation.
For years, people who live in rural parts of the US have had a hunger for true internet connectivity. They want to be able to live in rural places that may have a higher quality of life for them and their family, but they can’t because the internet is either unavailable or far too slow. The big service companies like Comcast or Charter would love to add subscribers, but the price tag on connection does not result in high returns because customer density is just too low. On some level, this problem is solved by the government subsidy programs, but the government doesn’t offer service, so they need help from true operators. Comcast and Charter are far from the only companies that would want to offer their service over subsidized pipes, but they are clearly the most capable.
There are many small cable and telecom operators out there that would like to play and enjoy sticky revenues with relatively high margins. The Electric Co-ops that serve these areas want to participate too and they already have access to some of the infrastructure. But because we can’t come to any agreement as to who owns or will service what areas, rural spaces continue to go unserved. But another issue that has become particularly clear over the last few years is that there isn’t anyone around to lay, splice or network the necessary fiber.
We talk regularly about the strains on the economy that can, and will cost people their jobs, but this is a situation that highlights just how desperate some industries are and will be for people. Depending on who you believe, we are between 30,000 and 205,000 people short for installing broadband. When we fill this gap, rural America may truly see a new potential for economic growth, but businesses and families may need to be more flexible to unlock this potential.
As the economy weakens in other industries, we look for workers to chase jobs. This should mean some potential for growth in the flyover states, particularly blue-collar workers. Should this occur, there will be an increasing need for multifamily housing in what is currently less populated areas.
Source: Wall Street Journal