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Systemic Racial Discrimination Worsens the US Digital Divide, Study Says

Structural discrimination in housing, banking, and other sectors exacerbates internet inequality.

Over the last two decades, the internet has assumed a central role in the US economy and political system. Today, there is a growing consensus among policymakers that broadband internet access is a necessity for citizens, not merely a luxury like cable television.

But despite the internet's importance for communication, economic growth, civic empowerment and upward mobility, there remains a troubling "digital divide" in the US between those with internet access and those without it.

What explains this gap between the "internet-haves" and the "internet-have-nots"?

For years, the conventional wisdom has been that wealth and income differences—along with a presumed lack of interest in internet services—have been among the dominant factors, especially due to the relatively high cost of US service compared to other developed countries.

But along with economic inequality, there is another culprit exacerbating the digital divide, according to a new study released Tuesday by a leading public interest group: systemic racial discrimination in housing, banking and other sectors of the economy, along with broadband industry practices that pose barriers to internet adoption among marginalized groups.

In a 225-page report entitled "Digital Denied: The Impact of Systemic Racial Discrimination on Home-Internet Adoption," Fress Press, a DC-based public interest group, concludes that "there's no doubt that structural barriers, structural discrimination, and bias against people of certain races and ethnicities all have a direct impact on the digital divide."

"Income inequality results in disproportionately low broadband deployment and competition in communities of color," according to the report. "And in rural areas, there is even more at play than income disparity, with a consistent digital divide for deployment that is apparently based on race and ethnicity alone."

The report cites US Census data showing that even among the poorest segments of the population, there is a pronounced digital divide between members of different racial and ethnic groups, with poor Whites more likely to have internet access than poor Blacks, Hispanics, Native Americans and Pacific Islanders.

One of the key findings in the report undermines a central claim often used to explain the digital divide: a lack of demand for internet service among low-income, minority and underserved populations.

On the contrary, the report concludes that these marginalized groups often have a high level of demand for internet access, but the high price of service, coupled with structural economic and sociological factors associated with race and ethnicity, pose barriers to internet deployment and adoption.

"The answer is not that people of color simply have a lower overall demand for internet access," said S. Derek Turner, research director of Free Press and author of the report. "Indeed, the data indicate that members of these communities who are on the wrong side of the digital divide have a high demand for internet access, but do not subscribe due largely to cost concerns."

Consider the following facts from the report, which are sourced primarily to US Census data:

  • While 81 percent of Whites and 83 percent of Asians have home internet (counting wired and wireless subscriptions alike as "home" access), only 70 percent of Hispanics, 68 percent of Blacks, 72 percent of American Indian/Alaska Natives, and 68 percent of Native Hawaiian/Pacific Islanders are connected at home.
  • There is still a racial/ethnic digital divide even among persons in the lowest-income quintile. Among those with annual family incomes below $20,000, 58 percent of Whites have home-internet access versus just 51 percent of Hispanics and 50 percent of Black people in the same income bracket.
  • After accounting for differences in income, education age and other factors impacting the decision to subscribe, we observe a home-internet adoption gap of 6 to 8 percent between Hispanic, Black and Native American households and White households.

The report finds that the digital divide is particularly pronounced in the market for wired home internet service, and cites "structural discrimination in the banking and credit industry" that "widens the adoption gap for many goods and services, including necessities such as internet access."

"Wired providers have failed to offer resold or prepaid services, and generally have required potential customers to undergo credit checks or make cash deposits—practices that contribute to the digital divide by exacerbating existing racial disparities in credit scoring, housing and other economic sectors," according to Turner.

"Discriminatory credit and lending practices can result in credit scores for low-income persons of color that overstate their true risk when compared to Whites with the same income," according to the report. "When this structural difference in credit scores is combined with the widespread practice of wired ISPs requiring credit checks for potential subscribers, it can result in lower adoption levels in communities of color."

The report points out that the Communications Act "has specific requirements that telecommunications services such as broadband internet access be offered on a reasonable and nondiscriminatory basis, and the FCC must be vigilant in enforcing these requirements."

The report also suggests that "structural factors linked to race and ethnicity may help determine where internet service providers (ISPs) choose to invest in infrastructure and broadband deployment, exacerbating the digital divide."

"For example, housing discrimination could create clusters of populations that are more likely to be unserved or underserved—suggesting not just that internet access providers choose to serve more lucrative areas, but explaining why some areas are less lucrative," according to the report.

In order to address the structural and systemic factors associated with race and ethnicity that contribute to the digital divide, the Free Press report urges the FCC and other policymakers to adopt a number of recommendations.

These include encouraging broadband competition and cracking down on monopoly abuses; fostering the development of pre-paid wired internet services (such as that recently announced by Comcast); ensuring that affordable, stand-alone broadband service is available to consumers; policing ISPs for discriminatory credit-check practices; and encouraging broadband deployment in low-income and underserved areas, particularly in rural communities, not just in wealthy or predominantly White areas.