Broadband Adoption, Rural Broadband Availability, Broadband Infrastructure, Broadband Digital Divide, Community/Rural/Urban Development, Research and Development/Tech Change/Emerging Technologies, R22, D12,

Whitacre, Brian E.

English

Research Papers in Economics

  
 
 
4th Quarter 2010 | 25(4)  
RURAL BROADBAND AVAILABILITY AND ADOPTION IN OKLAHOMA 
Brian E. Whitacre 
JEL Classifications: R22, D12 
Keywords: Broadband Adoption, Rural Broadband Availability, Broadband Infrastructure, Broadband Digital 
Divide 
Rural areas generally lag behind their urban counterparts in terms of broadband Internet access, a 
discrepancy commonly known as the “digital divide.” Nationally, the divide was approximately 12 percentage 
points as of 2009, with 54% of rural households adopting broadband access compared to 66% in urban 
areas (NTIA, 2010). A large body of work has attempted to uncover the underlying causes of the divide, with 
the implication that shrinking the gap will positively benefit rural communities economically and socially 
(Strover, 2001; Malecki, 2003; Whitacre, 2010). The policy prescriptions resulting from this work have 
focused on one of two sides: supply—the availability of broadband infrastructure, such as cable Internet lines 
or Digital Subscriber Lines (DSL)—and demand—increasing adoption rates when broadband is available. In 
particular, the American Reinvestment and Recovery Act (ARRA) included funding both for broadband 
infrastructure grants/loans and for programs to encourage sustainable adoption. 
This paper uses the state of Oklahoma as a case study in examining both the availability of broadband 
access and adoption rates in rural vs. urban areas in three distinct time periods: 2003, 2006, and 2009. As 
might be expected, wired broadband availability first clustered in urban areas across the state, but diffused 
rapidly over time and became nearly equal by 2009. Similarly, adoption rates increased dramatically across 
the state, and although a significant rural-urban gap still exists, it has noticeably decreased as infrastructure 
and Internet awareness becomes more prevalent in rural areas. The paper concludes with a discussion of 
policy implications, noting that future efforts to close the rural-urban digital divide should emphasize demand-
side policies rather than the traditional supply-side focus. 
Supply Data 
The federal government’s primary source of data regarding broadband infrastructure is the Federal 
Communication Commission’s Form 477. However, these data reveal where broadband subscribers currently 
exist and not necessarily where the infrastructure itself exists. Since Form 477 collects data from all providers 
of broadband access and asks them to report ZIP codes where they have customers, a single satellite 
subscriber in a rural area could give that ZIP code the illusion of having “wired” access. This is one reason 
why Form 477 indicated that as of December 2005, 99.9% of the most populated ZIP codes had broadband 
access, and even showed that 96.2% of the least-populated ZIP codes had broadband access. Thus, using 
this data source might suggest that there is little problem with broadband availability in rural America. 
However, the noted issues with this data suggest that alternative sources should be used to attempt to map 
out the existence of broadband infrastructure. In particular, the two dominant sources of residential 
broadband infrastructure have been cable Internet and DSL, together making up over 80% of the residential 
market (FCC, 2009). Maps of the availability of cable Internet access are documented in Warren Publishing’s 
annual TV and Cable Factbook, which lists every cable system in a state, denotes the communities served, 
and indicates whether or not cable Internet is offered. Similarly, the National Exchange Carrier Association 
Tariff #4 Dataset lists all telephone central offices in a state, the communities they serve, and whether or not 
they offer DSL access. These sources can be mapped to ZIP codes to document the existence of wired 
broadband infrastructure across a state. Data were collected from these sources in 2003, 2006, and 2009. The use of ZIP codes is not a precise representation; no publicly available information exists on the exact 
locations passed by either cable Internet or DSL lines in Oklahoma. In particular, some large ZIP codes 
depicted as having access may not be fully served, particularly for the more rural portions. However, in the 
absence of service provider maps, the data used is the next-best alternative. 
Figure 1 displays a map of the rural and urban ZIP codes in Oklahoma, taken from approximations to rural-
urban commuting area (RUCA) codes provided by the U.S. Department of Agriculture’s Economic Research 
Service. Codes 1-3 of this categorization are considered urban, while codes 4-10 are considered rural. Maps 
displaying the availability of broadband infrastructure in 2003, 2006, and 2009 are shown in Figures 2—4. 
 
 
As these figures indicate, the initial placement of broadband infrastructure by DSL and cable providers was 
focused on the more urban locations across the state. However, a notable exception is the western 
panhandle, which is extremely rural and yet was serviced by DSL in 2003. Broadband infrastructure diffused 
notably over the years and became much more available by 2009, although the heavily forested 
southeastern part of the state remains mostly unserved. Figure 5 shows the percentage of rural and urban residents with broadband infrastructure available to them in each of the three years. 
Clearly, urban residents had significantly higher levels of infrastructure availability in 2003. By 2006, 
however, the gap had shrunk significantly; and by 2009, availability was nearly equal. It is worth noting that 
the Oklahoma legislature passed a broadband parity bill in 2002, which was widely credited with increasing 
DSL deployment across the state. This bill ended the requirement for incumbent telephone providers to share 
their lines with competitors across the state, and the percentage of telephone central offices offering DSL 
increased dramatically: from 10% of all offices in 2003, to 21% in 2006, and to 66% by 2009. 
 
 
 
Demand Data 
Data on levels of broadband adoption came from three distinct surveys. In 2003 and 2006, the Bureau for 
Social Research at Oklahoma State University conducted telephone interviews of approximately 1,200 
households across the state. The households interviewed were not the same in both years, but were 
representative of the state when survey weights were applied. In 2009, the Current Population Survey conducted a national level telephone survey regarding broadband adoption, and in doing so contacted 1,500 
households in Oklahoma. Respondents were asked demographic questions in addition to inquiries into their 
use of broadband Internet from home. “Rural” households were determined by ZIP-code level RUCA 
approximations in 2003 and 2006, and traditional Office of Management and Budget definitions in 2009. Both 
definitions use the same cutoff point of population less than 50,000 for determining whether a location is 
rural, so the results are comparable. Figure 6 shows the rural, urban, and state averages for broadband 
adoption rates over the three years. 
 
The general pattern of increased adoption rates for the entire state speaks to both the increased availability 
of infrastructure and higher levels of awareness about the benefits of broadband access (Whitacre, 2010). 
While the rural-urban gap in adoption rates slightly increased between 2003 and 2006 from 12 percentage 
points to 14 percentage points, it shrunk to 9 percentage points in 2009. This is similar to what has occurred 
nationwide, with the rural-urban broadband digital divide decreasing from 15 percentage points in 2007 to 12 
percentage points in 2009 (NTIA, 2010). Another interesting point from the NTIA report is the decreased 
reliance on dial-up Internet access in both rural and urban areas. Nationally, use of dial-up Internet service 
was cut in half over the period 2007-2009—from 19% to 9% for rural areas and from 9% to 4% for urban 
centers .  
Policy Implications 
Both the maps of infrastructure availability and the household adoption data suggest that broadband access 
is increasing in popularity across Oklahoma. While a significant rural-urban digital divide remains, it 
decreased over the period 2006-2009. Assuming that policy makers have a goal of increasing broadband 
adoption rates in rural areas, what are the best steps forward? 
To date, most federal policies dealing with rural broadband have focused on the supply side of the picture. In 
particular, Community Connect grants and rural broadband loans from the U.S. Department of Agriculture 
have funded new broadband infrastructure in rural and underserved areas, providing over $1.5B in funding 
since 2002 to projects impacting more than 1,500 communities. However, the vast majority of broadband 
infrastructure investments was made by private companies providing cable and phone service, and resulted 
from their own response to market conditions. Since 2002 the state of Oklahoma has received numerous 
federal grants related to broadband infrastructure. Twenty Community Connect grants are on record; but 
nearly all of these were for wireless systems associated with relatively small numbers of recipients. Most 
rural Oklahomans received infrastructure improvements as a result of their cable or phone companies’ 
investments. 
More recently, the American Reinvestment and Recovery Act (ARRA) included approximately $7.2B for rural 
broadband efforts, and again focused mostly on the provision of infrastructure. This funding was split 
between the Rural Utilities Service ($2.5B) and the National Telecommunications and Information 
Technology ($4.7B). $350 million was included in the NTIA funding to develop and maintain comprehensive 
maps of existing broadband service capability and availability. These maps should be constructed at a lower 
level of detail than the ZIP-code level maps created in this article, and should help with future allocation of 
infrastructure funding by showing exactly where such infrastructure is lacking. The ARRA funding included 
some explicit demand-side programs, such as the $250 million allocated to the NTIA to encourage 
sustainable adoption. This represents less than 3.5% of the total broadband-related funding included in the 
act. A review of the available empirical evidence, however, implies that prioritizing supply-side funding is 
misguided. Most academic research on the topic suggests that policies seeking to raise rural broadband adoption rates 
should focus primarily on the demand component. When asked why they did not have broadband access 
from home, the dominant response for rural households was “Don’t need/not interested” (NTIA, 2010). “Not 
available” ranked as #4 on the list of reasons, behind “too expensive” and “no computer.” Introducing rural 
individuals to broadband access and demonstrating why it is useful for them will likely have the largest impact 
on broadband adoption rates in rural areas. At least two recent papers have focused on existing demand-
side programs and discuss many potential solutions, including subsidizing access and digital literacy 
programs (Hauge and Prieger, 2009; Atkinson, 2009). Hauge and Prieger (2009) also point out the need for 
rigorous program evaluation, since most efforts fail to compare their results to a counterfactual—what would 
have happened in absence of the program. This is particularly important as knowledge about broadband 
continues to diffuse to the general population, regardless of whether or not a demand-side program is in 
place. 
Of some concern to rural advocates is the recent goal set by the FCC of “100 Squared”—100 million homes 
using 100 megabits per second (Mbps) service by the year 2020 (Genachowski, 2010). This goal is part of 
the National Broadband Plan developed by the FCC. The current average U.S. broadband speed is only 3.9 
Mbps. While not a formal policy with any funding behind it, this goal nevertheless indirectly suggests that a 
disparity in the speed of service provided is acceptable. If driven by market conditions, as the initial 
broadband roll-out was, there is little doubt that the 100 million homes served would primarily be found in 
urban areas. By pushing for only 100 million homes and not ubiquity, the FCC is essentially encouraging a 
next-generation digital divide where rural areas cannot accomplish the same online tasks as their urban 
counterparts. 
Education to Improve Rural Broadband Adoption 
Since most Extension faculty at land-grant universities across the nation interact with rural constituents, they 
and others can play a significant role in encouraging rural broadband adoption. For example, many farm 
assistance programs offer courses on QuickBooks or other financial programs. These could easily be 
extended to how to use the Internet to do simple tasks like using eForms to complete and submit a Farm 
Service Agency program form, monitor prices on their products, or order inputs. Those involved in health 
education can show residents what trusted sources of medical information are out there, and discuss best 
practices in using the information. This would include using online information in conjunction with, not as a 
substitute for, a visit to the doctor. Videos discussing impending medical procedures can be particularly 
useful. Similarly, individuals involved in rural development often interact with small business owners who can 
benefit from courses on basic website setup or selling their product using online retailers. Many programs 
have already been developed under the Southern Rural Development Center’s e-commerce curricula, 
discussed elsewhere in this issue, and are ready for implementation. Regardless of the program, the focus 
should be on demonstrating to a rural resident why they should make the investment in broadband—what is 
the benefit to them? 
In Oklahoma, Extension personnel have implemented an extensive e-commerce curricula focusing primarily 
on small business owners. Individual workshops are hands-on in nature, typically performed in a computer 
lab with broadband connections. A multitude of concepts are demonstrated that small business owners might 
find useful, from planning and actually building a website to search engine optimization and incorporating 
social networks into a business plan. Other workshops promote general knowledge about the benefits of 
broadband, such as “social networking for everyday people” which attracts retirees wanting to learn about 
Facebook, provides examples of how Twitter can be used professionally, and demonstrates how Internet 
forums can connect people with shared interests. Future plans include taking Hauge and Prieger’s 
suggestion to heart, and performing detailed program evaluation that demonstrates the benefits provided to 
the rural communities engaged. 
Ultimately, improving broadband access rates in rural America requires that broadband infrastructure be 
available, and that the benefits to rural citizens exceed their costs. Data from Oklahoma suggest that the 
availability of two dominant sources of broadband infrastructure has made dramatic improvements during the 
2000s, and rural availability rates are now similar to those in urban areas. Future supply-side policies will 
likely be required to address individual cases of neglected communities, aided by availability maps that are 
created on the census block level. More important, however, are demand-side policies that encourage 
adoption. While debates will likely continue over the best programs to influence adoption—including 
increased competition, subsidized access, or computers—land-grant faculty and others can play a role by disseminating knowledge about the benefits of broadband in the context of their current programs. 
For More Information 
Atkinson, R.D. (2009). Policies to increase broadband adoption at home. The Information Technology and 
Innovation Foundation. Available online: http://www.itif.org/files/2009-demand-side-policies.pdf . 
Federal Communications Commission (FCC), Industry and Analysis and Technology Division. (2009). High-
speed services for Internet access: Status as of June 30, 2008. Available online: 
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-296239A1.pdf . 
Genachowski, J. (2010). Broadband: Our enduring engine for prosperity and opportunity. Prepared remarks 
of FCC chairman for NARUC conference. Available online: 
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-296262A1.pdf . 
Hauge, J.A., and Prieger, J.E. (2009). Demand-side programs to stimulate adoption of broadband: What 
works? Social Sciences Research Network. Available online: 
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1492342 . 
Malecki, E.J. (2003). Digital development in rural areas: Potential and pitfalls. Journal of Rural Studies, 19(2), 
201-14. 
National Telecommunications and Information Administration (NTIA). (2010). Digital nation: 21
st century 
America’s progress toward universal broadband Internet access. U.S. Department of Commerce. Available 
online: http://www.ntia.doc.gov/reports/2010/NTIA_internet_use_report_Feb2010.pdf. 
Strover, S.L. (2001). Rural Internet connectivity. Telecommunications Policy, 25(5), 331-47. 
Whitacre, B.E. (2010). The diffusion of Internet technologies to rural communities: A portrait of broadband 
supply and demand. American Behavioral Scientist, 53(9), 1283-1303. 
Brian Whitacre (brian.whitacre@okstate.edu) is an Assistant Professor in the Agricultural Economics 
Department at Oklahoma State University. 
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attribution to Choices and the Agricultural & Applied Economics Association is maintained.  
 
 

RURAL BROADBAND AVAILABILITY AND ADOPTION IN OKLAHOMA

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