December 18, 2012 – The year 2012 has provided significant progress in broadband within the United States. Whether through policy developments, or through technologies advancing the rate of internet speeds, the business case for making use of those higher speeds is also progressing in a meaningful way.
It’s almost as if the presidential and other federal elections – dominated as they were by issues other than broadband and technology – allowed the breathing room for practitioners, in Washington and outside of Washington, to make progress on bringing the nation better broadband.
Here’s the list of the 10 most significant events for broadband. We’ll soon follow up with 10 broadband developments to watch for in 2013.
1. Revisions to the Universal Service Fund.
At the end of 2011, the Federal Communications Commission began a major overhaul of the decades-old Universal Service Fund. Through an order of more than 700 pages, the agency created three major new funds: the Connect America Fund, the Mobility Fund, and a much smaller Remote Areas Fund, for extremely rural areas, particularly in Alaska. Throughout 2012, the FCC undertook Phase I of both the Connect America Fund and the Mobility Fund. The Mobility Fund has been particularly successful. In September, the FCC held its first “reverse auction” for $300 million in subsidies for mobile broadband: awards went to the mobile providers willing to serve the most unserved census blocks at the lowest prices. By contrast, the Connect America Fund, for wireline providers, was undersubscribed; over the summer the FCC awarded $115 million to large so-called “price cap” carriers, including CenturyLink and Frontier. The agency had been looking to spend $300 million; it will soon begin the process for $185 million of awards in Phase 2.
2. LTE Reaches the Mass Market.
Even though major wireless carriers such as Verizon Communications began promoting its fourth-generation wireless standard dubbed LTE (for long-term evolution) for more than two years, in 2012 LTE became a reality for middle America. Verizon has been quicker than AT&T, but AT&T has expanded more rapidly over the past year. From November 2011, when Verizon Wireless boasted coverage in 190 markets to AT&T’s 15 markets, one year later Verizon Wireless offers service in 441 markets, serving 250 million people. AT&T now offers 190 markets, and is available to 150 million people. Plus, with the launch of the Apple iPad 3 in March of 2012, the first Apple device with LTE technology, consumers could now obtain real-world download and upload speed in excess of 10 megabits per second. For the first time it begins to be possible to envision wireless as a substitute for DSL or cable connectivity, provided that consumers adapt to metered charges for mobile data consumption.
3. Gigabit Fiber Initiatives at the Local Level.
In Illinois, Gov. Patrick Quinn (D) announced the Illinois Gigabit Communities Challenge in the State of the State address on February 1, 2012. The challenge offered $6 million in funding to broadband companies and public-private partnerships proposing gigabit-level connectivity to at least 1,000 residents within their community. Illinois joined a number of other locations, including Chattanooga, Tennessee, and Lafayette, Louisiana, with “big broadband” projects designed to bring economic enhancement through super-fast connectivity. Following a competition which that spurred 40 applicants in Illinois, the first two Gigabit awards – to Gigabit Squared, the University of Chicago and several neighborhoods on the South Side of Chicago; and to Aurora, Illinois – were announced on October 16.
4. DOCSIS 3.0 Rolls Out Nationwide.
Early in the year, cable giant Comcast announced that it had completed its DOCSIS 3.0 expansion for its entire footprint in the United States. DOCSIS 3.0 is the name for the next version of cable modem technology. The move brings the possibility of promised speeds of 100 megabits per second to all of Comcast’s 52 million household subscribers, although consumers need to subscribe to them. Additionally, consumers need DOCSIS 3.0 hardware in order to take the service, and somewhere between 43 percent and 77 percent of the nation’s cable subscribers had that upgrade. The cable industry’s push for DOCSIS 3.0 stands in contrast with Verizon's decision to stop the expansion of its Fiber Optic Service and AT&T's November 7, 2012, announcement that it will begin to favor investments in wireless technology over uVerse investments. Traditional telephone giants may be leaving the wireline field to their former cable competitors.
5. Gig.U. and Gigabit Squared Strike Deals.
One of the most creative of broadband initiatives over the past several years is Gig.U, or the University Community Next Generation Innovation Project. The goal is to leverage the bandwidth needs of the communities around world-class universities. Think of it as an ultra-high-speed form of “aggregating demand.” Spearheaded by Blair Levin, chief architect of the FCC’s National Broadband Plan of March 2010, Gig.U. has assembled 37 world-class universities seeking to entice investment by major and new telecom entrants. In May, the consortium announced a $200 million commitment from Ohio-based Gigabit Squared, promising to build infrastructure in six of the 37 communities. The first to be announced was on the south Side of Chicago, in partnership with Illinois Gov. Pat Quinn's Gigabit Challenge, and the second was announced last week, with the University of Washington and the city of Seattle, Washington.
6. Google Fiber Goes Live.
The original big new entrant to the fiber community was none other than search engine giant Google. Way back in February 2010, in the midst of the Broadband Technology Opportunities Program under the American Recovery and Reinvestment Act, Google announced a competition to build gigabit connectivity. The competition, dubbed by some a "third round" of the federal stimulus, following the two-stage process followed by the U.S. Departments of Commerce and Agriculture, generated 1,100 applications. Ultimately, selected cities were Kansas City, Kansas, and Kansas City, Missouri. The first fibers there went live July 2012. For $70/month, consumers are eager, and companies are chomping to envision the attention and innovation associated with mass-market gigabit connectivity.
7. U.S. IGNITE Catches Fire.
Fiber developments like FiOS, GigabitSquared and Google sometimes prompt the following question: if consumers aren't making use of 25 megabits per second now, why would anyone need 40 times that speed? The national non-profit U.S. IGNITE aims to provide an answer to that question. Seeded by the National Science Foundation, U.S. IGNITE seeks to build the business case for these highest-bandwidth applications. In an Executive Order issued in June, the White House put its stamp of approval on the program, and said that it would help “create a national network of communities and campuses with ultra-fast, programmable broadband services, operating at speeds of up to 1 gigabit per second. This network will become a test-bed for designing and deploying next-generation applications to support national priorities.”
8. Connect2Compete Gets Real.
While U.S. IGNITE works on promoting broadband on the ultra-high-speed scale, another national non-profit, Connect2Compete, is beginning to hit its stride in promoting what broadband can do for all Americans, including low-income individuals who lack money, computer equipment, and digital skills necessary to tap into what the internet can offer. The basic concept is for foundations like the Instituto Carlos Slim, the Knight Foundation and the Wasserman Foundation to partner with computer and software companies like GoodPC and Microsoft, and with training entities, to connect consumers with broadband providers. Predominantly cable-industry led, the initiative also provides a model for revamping the FCC’s Lifeline/Linkup program of the Universal Service Fund.
9. Exede Excedes Expectations.
To some fanfare at the Consumer Electronics Show in January 2012, ViaSat, which bought satellite broadband provider WildBlue in 2009, unveiled its new service, Exede. With $400 million in a new satellite, plus ground stations and terrestrial fiber networks, the company wants to change the image, and the expectations associated with, satellite broadband. Not to be outdone, HughesNet Gen4 has also upped its increased speeds to 15 Mbps. While it remains to be seen whether rural America will adopt, the new satellite services provide new options for areas without access to fiber, cable or wireless broadband services.
10. The Chicago Broadband Challenge.
On September 24, Chicago Mayor Rahm Emanuel – the first Chief of Staff to President Barack Obama – melded the importance of broadband with his top priority investments. Elected as mayor in February 2011, his broadband challenge invited the public and providers to participate with ideas and insight as to how Chicago can tap into existing broadband infrastructure and potential uses for future expansion of broadband access. In an interview on the program, Chicago Chief Technology Officer John Tolva highlighted the need to drive business broadband with lower prices.
Drew Clark is the Chairman of the Broadband Breakfast Club, the premier Washington forum advancing the conversation around broadband technology and internet policy. You can find him on Google+ and Twitter. He founded BroadbandCensus.com, and he brings experts and practitioners together to advance Better Broadband, Better Lives. He’s doing that now as Executive Director for Broadband Illinois, based in Abraham Lincoln’s Springfield.
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