FCC’s Genachowski Putting Focus on Small Business Broadband Adoption

The FCC announced Wednesday the launch of a small business broadband adoption public-private partnership, linking Score, the Small Business Administration’s volunteer arm, and “private partners,” including AT&T, Best Buy, Cisco, Constant Contact, Google, Hewlett-Packard, Intuit, Microsoft, Skype and Time Warner Cable.

The initiative is critical to help the U.S. keep from falling further behind versus other countries in broadband deployment and resulting “innovation,” said FCC Chairman Julius Genachowski who spoke at an event announcing the launch. One of the things that the FCC saw as it put together its National Broadband Plan was not that only is the U.S. lagging other countries globally in broadband adoption, but some communities here are also lagging more than others, Genachowski said. “We saw that small businesses are lagging compared to where they need to be to meet the potential of small businesses to generate jobs in the United States, to contribute to economic activity,” he said. “We saw that are problems with access and we saw that there are problems with training and understanding of the benefits of broadband."

Broadband can help small businesses expand their businesses and get more revenue and also lower their costs, Genachowski said. “To know we have a formula that helps them increase their markets and lower their costs, of course that’s going to result in more job creation,” he said. “That’s why we have to take this so seriously.” Genachowski cited the example of Warren Brown, CEO of Cakelove, a bakery with outlets in the Washington area, who spoke at an August FCC broadband workshop on how use of the Internet had helped expand his business. “He said, ‘It’s all about broadband,'” Genachowski said of Brown. “Today if you want to succeed with a business you have to go to where the customers are. The customers are online. The customers are on their mobile broadband phones."

Genachowski said he remains very concerned about the state of broadband deployment in the U.S. “The most recent study that I saw that gets me worried about the future of our country if we stand still was a study that ranked 40 industrial countries on their innovative capacity and their global competitiveness and they ranked the U.S. sixth,” he said. “You can argue whether that’s good enough. It’s not good enough for me.” The study also examined the rate of change of innovative capacity. “It ranked the U.S. 40th out of 40,” he said. “What it tells us is the rest of the world is not standing still when it comes to its broadband infrastructure. It understands that a modern, world-class broadband infrastructure is the platform for economic activity, for new businesses, for the expansion of existing businesses."

Genachowski said he’s also concerned about a recent report in The New York Times that Applied Materials, a Silicon Valley company, sent Corporate Technology Officer Mark Pinto to China to work out of an office there instead of in the U.S. “They thought here’s where the innovation is happening,” Genachowski said. “That should worry us."

"There is a really strong collaboration going on here between the Small Business Administration, the FCC … and Score,” said SBA Administrator Karen Mills. There are 12,000 Score volunteer counselors in 350 chapters across the U.S. “We have on the ground a number of people who are helping businesses one by one, giving them the tools to grow and create jobs,” Mills said. “As Julius said, this is important in our economy. Half the people who work [either] own or work for a small business. … Sixty-five percent of the net new jobs are created by small business.”

For small businesses, the two biggest issues concerning broadband are access and affordability, Mills said. “In terms of access, it’s not terrible, it’s about 95 percent, but there’s different kinds of broadband and there’s areas that aren’t being reached and there’s speeds that aren’t being reached and there’s cost issues,” she said. “Really, small businesses don’t use the broadband that they have. They need tools. They need training and they need the help of counselors” like those provided by Score.

"We deal with thousands of small businesses everyday and they really are making use of cutting edge technology,” said Jeff Brueggeman, AT&T vice president of public policy. “They are really adopting mobile broadband as a key part of their business. They're doing web hosting and doing e-commerce and they're also taking advantage of new cloud computing services that really provide them affordable and flexible services.” But small businesses also need help, he said. “We need to help get them information about what services are available to them, how to make use of those services for their business,” he said. “We need to help them secure their services. … Unlike a large company, they don’t have the resources to kind of have a dedicated technical staff in many cases.”