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Problem: As kids start to go back to school, those who are poor can't afford reliable internet access and probably don't have access to technologies.
Solution: This business would help with remote learning by using school buses as a means of transporting necessary tools and devices for education to students. Each bus would be equipped with Wi-Fi that students can use and devices that students can rent. The bus routes would actually not have to change substantially, they would simply switch functions from moving people to moving technology and connectivity. On September 2, 2020, Nicholas Kristof wrote a piece in the New York Times where he argued that ‘Remote Learning’ is often an oxymoron:
In short, affluent children will mostly be fine even without in-person classes. But one study found that almost 17 million American children live in homes without high-speed internet, and more than seven million don’t have a computer at home. For disadvantaged kids, “online learning” is an oxymoron.
Prolonged school closures will worsen dropout rates across the nation, for missing just 10 percent of class days is associated with a sevenfold increased risk of dropping out. Even in normal times, only 53 percent of children attending Bureau of Indian Education schools finish high school. Closures after Hurricane Katrina led many students to leave school for good.
There are others who are attempting to solve this problem, such as Bandwidth for All which is “modeled on rural electrification in the 1930s and ’40s.” This business would similarly be a private company with a mission of connecting every student in America to high-speed internet connection. Broadly, the problem is described quite well in this July 18, 2020 New York Times piece by the NYT Editorial Board (emphasis mine):
Universal broadband will be costly, but shelter-in-place orders have demonstrated that it is even more costly to leave so many Americans behind. A House bill to accelerate deployment of the $20.4 billion overseen by the Rural Digital Opportunity Fund is a start, but the F.C.C. has estimated it could take $80 billion to reach nearly every American without broadband. House Democrats proposed in April that more than $80 billion be authorized over five years for broadband expansion.
“People are afraid of the price tag,” said Mr. Clyburn, a co-sponsor of the bill along with Representative Fred Upton, Republican of Michigan. “We can’t afford not to do it.”
Perhaps more daunting is the challenge of providing service that is speedy and at a price that even lower-income Americans can afford. One study found that poorer Americans can afford only $10 a month for internet service. But such service is typically at far slower speeds than what is available in more affluent neighborhoods, or for free at Starbucks.
Private industry may have little desire to provide lower-tier broadband service when it can profit far more from higher-end services. The expansion of federal programs, like E-Rate, to allow schools to distribute broadband service directly to students could also help lower costs.
But those solutions are not a fix to the broader problem. Drawing Wi-Fi from school buses and fast-food restaurants isn’t a long-term solution.
A device rental school bus would be the start, but the goal for the business would be to quickly grow to be a internet connectivity and infrastructure provider.
We can understand the market by looking at the writings and reports of IbisWorld. “Rising internet usage has significantly benefited the Internet Service Providers industry in the United States. Current regulatory overhaul has driven government-subsidized network expansion and has increased the number of US broadband connections, further driving industry revenue growth. A push toward broadband expansion in rural markets and a rise in demand from business customers has boosted industry revenue, which has increased an annualized 1.2% to $115.6 billion over the five years to 2020, including a decline of 3.8% in 2020 alone.” Some of the key players include Cisco, GE, Comcast, and Oracle, among others.
Monetization: Charging school districts for this service.
Contributed by: Michael Bervell (Billion Dollar Startup Ideas)