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Recovery Act

Verizon and Free Press Agree that Remote Broadband Requires Monopolies

January 22, 2009 – Verizon Communications and Free Press agreed that bringing high-speed internet technology to unserved areas of western Massachusetts may result in a monopoly, or a single local telecommunications provider.

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January 22, 2009 – Verizon Communications and Free Press agreed that bringing high-speed internet technology to unserved areas of western Massachusetts may result in a monopoly, or a single local telecommunications provider.

In separate comments made last month in a state broadband inquiry, the telecommunications giant and the advocacy group both said that economic factors are likely to tilt toward a single broadband provider.

But they disagreed about whether Net neutrality or other open access rules should be imposed upon such a monopoly.

Verizon and Free Press were among 29 organizations that filed comments as part of the “call for solutions” to the problem of bringing broadband to the Berkshires and other areas of western Massachusetts.

Massachusetts is one of the leading states in the drive to promote universal broadband deployment and availability. In August 2008, Massachusetts Gov. Deval Patrick, a Democrat, signed legislation authorizing up to $40 million in state funds to ensure that broadband is available to all the state’s citizens.

The comments were released on the web site of the Massachusetts Broadband Institute, the non-profit entity that will administer the state’s investment in broadband infrastructure.

The comments also provide a window into the arguments that are being made – both in Washington and in the states – about who and how the nation should fund the provision of universal broadband deployment.

“Underlying economic market factors” make it likely that there will be “the establishment of a single broadband provider serving each community,” wrote S. Derek Turner, research director of Free Press, which is based in Northampton, Mass. Referring to the efforts of the Massachusetts Broadband Institute, he said, “That is, the project will result in the establishment of a monopoly.”

Verizon agreed. One of the country’s leading telecommunications companies, Verizon offers digital subscriber line (DSL) service in portions of western Massachusetts, and fiber-optic service in more populous eastern areas of the state.

“While the MBI should look to an array of technological solutions,” Verizon wrote, “its goals and objectives may best be met by the recognition that a single service provider may be the most sustainable business model in some areas.”

“Economies of scale and scope are important factors in today’s telecommunications marketplace,” continued the filing, signed by John Conroy, vice president of regulatory matters for Massachusetts. “Recognizing that a decision that incorporates a single service provider that is best suited to provide the solutions will benefit the Commonwealth.”

Neither Free Press nor Verizon regarded the prospect of a monopoly as a negative.

“Natural monopolies in telecommunications networks are common, and monopoly harms are easily avoided through the implementation of consumer protection policies,” said Turner of Free Press. Among those protections should be rules requiring Net neutrality and wholesale access to competitors.

Verizon urged caution on open access rules. “The economics associated with building and maintaining a broadband infrastructure change dramatically when multiple carriers are allowed to use the infrastructure,” the company said. “Should the MBI proceed with open access requirements, it is critical that specific and detailed terms of use, including pricing, be clear and unambiguous.”

Others companies and trade groups filing comments in the proceeding included AT&T, Alcatel-Lucent, Ciena, and the New England Cable and Telecommunications Association.

Among the non-profits weighing in were Berkshire Connect and Pioneer Valley Connect, which have been seeking to provide broadband connectivity in the four counties of western Massachusetts; and Five Colleges Inc., which discussed the 53-mile fiber ring that it built to connect the colleges of Amherst, Hampshire, Mount Holyoke, Smith and the University of Massachusetts at Amherst.

Massachusetts Broadband References

BroadbandCensus.com References

  • January 17, 2009 – Massachusetts Gov. Deval Patrick highlighted the significance of broadband in his “State of the Commonwealth” address on Thursday, January 15.
  • January 16, 2009 – House Appropriations Committee Seeks $6 Billion for Broadband, Would Impose Speed Requirements Upon Most Grant Recipients.
  • January 2, 2009 – Broadband Stimulus Package Should Include Funding for State Data, Says Massachusetts
  • August 4, 2008 – Governor Deval Patrick signed a bill allocating $40 million for the provision of broadband to unserved areas in Massachusetts.
  • Visit BroadbandCensus.com’s Broadband Wiki for a catalog of the various broadband-related stimulus proposals.

Drew Clark is the Editor and Publisher of BroadbandBreakfast.com and a nationally-respected telecommunications attorney at The CommLaw Group. He has closely tracked the trends in and mechanics of digital infrastructure for 20 years, and has helped fiber-based and fixed wireless providers navigate coverage, identify markets, broker infrastructure, and operate in the public right of way. The articles and posts on Broadband Breakfast and affiliated social media, including the BroadbandCensus Twitter feed, are not legal advice or legal services, do not constitute the creation of an attorney-client privilege, and represent the views of their respective authors.

Broadband Mapping

In Discussing ‘Broadband and the Biden Administration,’ Trump and Obama Transition Workers Praise Auctions

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Screenshot from the November 2 Broadband Breakfast Live Online webcast

November 22, 2020 – In the event that the incoming administration of President-elect Joe Biden seeks substantial funding for broadband infrastructure, there is a strong likelihood that such monies would be channeled through a reverse-auction mechanism, said panelists at the Broadband Breakfast Live Online event on November 11.

See more from Broadband Breakfast Live Online, including “Broadband and the Biden Administration, Part II,” on December 2, 2020.

In a discussion with Broadband Breakfast Editor and Publisher Drew Clark, two broadband policy experts who served on the transition teams for Donald Trump and Barack Obama, respectively, championed the role of such a mechanism as efficient and fair.

Previous attempts to run funding through other selection processes provided funds only to the well connected, claimed to Mark Jamison, research and education director at the University of Florida, and who served on then President-elect Trump’s 2016 transition team.

Places with a Democratic governor or a congressman of either party that sat on a powerful committee were funded more often compared to other regions, Jamison said.

Whether or not funding mechanisms were in fact biased in that way, both Jamison and Technology Policy Institute President Scott Wallsten both praised the transparency and economic efficiency of the Federal Communications Commission’s reverse-auction funding mechanism.

Wallsten, an economist who was involved in the transition for then President-elect Obama, and who also served on the National Broadband Plan implemented in the first year of the Obama administration, criticized the Rural Utility Service and the old funding process of Universal Service Fund. Both said under these mechanism, a lot of money is spent without good information about how such funds are awarded or distributed.

Wallsten and Jamison agreed that more data would help make broadband funding more effective, they also said that the FCC was right to move forward with its Rural Digital Opportunity Fund auction on October 29 – part of the new auction-based approach to the Universal Service Fund – despite imperfect mapping.

In part, this was because any inadequacy of mapping data can be resolved in the challenge process, said Wallsten. Additionally, it is not clear that auctions like RDOF, or the Connect American Fund auction in 2018, would have yielded better results had the FCC waited to update their maps.

Jamison and Wallston also projected how the Biden administration might tackle net neutrality, Section 230 and antitrust regulation.

Jamison said that if the Biden administration reinstitutes net neutrality, it will quickly see that that won’t work very well.

Wallsten said that if it’s reinstituted the debate will be different than in the past. A large part of net neutrality is paid prioritization where third parties can pay ISP’s to put their content “at the front of the line.” He said that the pandemic has demonstrated why no paid prioritization may be a mistake, as many people need guarantees of stable connection for their schooling and telehealth applications.

Wallsten also noted that many made doom and gloom forecasts when the Trump administration FCC removed net neutrality protections in December 2017. None of those predictions came to pass, he said.

Both also agreed that the FCC should not be involved the regulation of Section 230 of the Communications Decency Act, which protects tech platforms from liability for user-generated comments.

They also were wary of changes to the consumer welfare standard governing antitrust because, said Jamison, “If you’re not regulating for consumers, who are we regulating for?”

See “Broadband Breakfast Live Online on Wednesday, November 11: Broadband and the Biden Administration,” Broadband Breakfast

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National Broadband Plan

National Broadband Plan Has Held Up Well, With Notable Downsides, Say Authors

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Photo of Blair Levin, former executive director of the National Broadband Plan, by New America used with permission

June 29, 2020 — The National Broadband Plan has been successful, despite notable downsides, said panelists in a Federal Communications Bar Association webinar on Friday.

The plan, first released ten years ago, aimed to increase competition, provide lower-cost service to more Americans and decrease regulatory barriers to broadband rollout.

“Ten years in this space in terms of technology is remarkable,” said Rebekah Goodheart of Jenner & Block. “At the time only 15 percent of people had access… of 25 megabits… The fact that this plan was able to stand up through time shows how visionary it really was.”

“All the stuff that we’re taking for granted now are things that came out of recommendations from the plan,” she added.

Participants noted that, despite broadband access deficiencies amid the coronavirus, “overall broadband adoption rates [are] going up reasonably well right now,” said John Horrigan, Senior Fellow at the Technology Policy Institute.

But there are still significant barriers to unfettered telework capabilities, he said.

“We’re also waking up to the fact that smartphones, as useful as they are, have significant limitations for completing homework,” he said.

Ruth Milkman of Quadra Partners agreed.

“There’s a lot of stuff you can’t do on a smartphone,” she said. “It’s hard to read papers… and there are data caps, and it can be quite expensive if you try to use it in the same way that you would use a fixed wireline network.”

Blair Levin, non-resident Fellow at the Metropolitan Policy Project of the Brookings Institution, said that sections of the National Broadband Plan held up remarkably well, even ten years later.

“In the healthcare section which says, ‘We really need to utilize telehealth because someday there’ll be a pandemic’… it does look very prophetic,” he said.

Despite the proactivity of the policy, Levin said, it has certain shortcomings that the FCC should address.

“We’ve become much more aware in this society of different ways in which our institutions do not include everyone and lead to inequalities,” he said. “I would argue that absolutely needs to be a new plan… now it’s more important than ever because we recognize the importance of closing that digital divide.”

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Digital Inclusion

Authors of the 2010 National Broadband Plan Say That a ‘Refresh’ Should Not Only Be Up to FCC

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Photo of INCOMPAS policy summit panelists discussing the National Broadband Plan by Adrienne Patton

WASHINGTON, March 4, 2020 – Panelists at the INCOMPAS policy summit Tuesday looked back with fondness on the Federal Communication Commission’s National Broadband Plan that was released 10 years ago this month. They agreed that if the plan is refreshed, the FCC should not be the lone agency to lead in the changes.

The 10-year-old plan was designed to “ensure robust competition” and “maximize the benefits of broadband,” while fostering the spread of broadband across the country, said INCOMPAS General Counsel Angie Kronenberg.

New Street Research Policy Analyst Blair Levin, who led the plan’s development, called it a “three-act play.”

The first act was the hiring people. The second act was holding hearings and acquiring data. The third act was an extensive writing process, Levin said.

When asked how the United States is doing in regards to the plan, Levin said there have been great improvements and some complications.

Mattey Consulting Principal Carol Mattey who worked on the plan, said it was a “long and evolutionary process,” that often required “nitty gritty details” from complex concepts.

Technology Policy Institute Senior Fellow John Horrigan, who also worked on the plan, said that while the statistics do not show a large increase in Americans that have wireline broadband at home, smart phones and mobile devices have made a huge difference.

Even so, Horrigan admitted that for children who have to do homework at home, smart phones are not enough.

However, Horrigan said the way that policy makers understand and think about the digital divide has improved.

A decade ago, city mayors were not concerned about digital inclusion, and now that has changed, said Horrigan.

Levin disclosed his frustration with the “metrics” section of the plan. The availability of bandwidth should not hinder economic growth, said Levin. But, “fundamentally we’ve made progress,” Levin admitted.

“The regulatory process is too slow to catch up,” and legislators are hesitant to look so far in the future while also considering cost concerns, said Mattey.

Looking ahead to a possible refresh of the plan, Horrigan said the FCC should not be the sole organization reworking the document.

Levin agreed and added that broadband has changed over the past decade as well. He called broadband a “mixed bag.”

The whole federal government should be thinking about how to revive the plan and take into consideration cybersecurity and privacy, Levin advised.

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