To Close Digital Equity Gaps, US Should Endow a Digital Futures Foundation from Proceeds of Spectrum Auctions​

Today, New America’s Open Technology Institute and the Johns Hopkins University Center for Civil Society Studies jointly released a proposal to invest a portion of the windfall proceeds from recent and anticipated auctions of public airwaves in a new private Digital Futures Foundation to develop improved digital applications that address digital equity gaps in education, telehealth, online government services, and other critical areas. 

While President Biden’s infrastructure plan will usefully address the national need for universal access to affordable broadband connections, getting everyone online will not solve the equally critical challenge of improving the public-purpose applications and training needed to enable full digital inclusion. 

According to Michael Calabrese, director of the Wireless Future Project at New America’s Open Technology Institute (OTI) and co-author of the proposal:

“To reap the full benefits of the president’s proposed investments in universal broadband access, we need to address the serious gaps in the applications that actually provide the services that broadband can deliver and the training citizens need to access them. Auctions of the public airwaves are raising tens of billions of dollars that should be recycled back into technology investments aimed at closing persistent equity gaps in digital learning tools, telehealth, environmental justice, and other critical needs.”

According to Dr. Lester M. Salamon, director of the Johns Hopkins Center for Civil Society Studies (JHU/CCSS) and the other co-author of this proposal: 

“With expanding demand for broadband triggering windfall proceeds from spectrum auctions, dumping these proceeds into the federal budget instead of using them to close these gaps in public-purpose digital applications and skills no longer makes sense. A foundation mechanism offers the best combination of flexibility, long-term perspective, and ability to engage other partners that developing the needed public-benefit digital applications will require.”

With the most recent spectrum auction, concluded in January, reaping a record $81 billion and several additional auctions coming later this year and in years to come, the OTI and JHU/CCSS proposal suggests that investing a meaningful share of these auction proceeds into an independent foundation dedicated to expanding the citizen usefulness and equity of the digital system makes the most economic and public policy sense. 

In reaching this conclusion, the OTI and JHU/CCSS proposal:

• Documents the forces driving the windfall proceeds of recent spectrum auctions;
• Calls attention to the long U.S. history of investing proceeds from the sale of public assets into public-purpose uses from the Northwest Ordinance of 1787 to the FirstNet Public Safety initiative of 2012;
• Reports on the U.S. and international successes of a strategy known as philanthropication thru privatization, which has led to the creation of 650 other private charitable foundations that make effective public-purpose uses of the proceeds from transactions involving other government-owned or -subsidized assets, including over 250 so-called health conversion foundations in the United States; and
• Points out the limitations of alternative business and governmental vehicles for developing the innovative public-purpose applications and training needed to close the equity gaps that will remain even after broadband infrastructure and affordability are expanded.