April 20, 2020— There are aspects of fiber-optic cabling that make the Rural Digital Opportunity Fund auction “very favorable” to the technology, said Kara Mullaley, a market development manager at Corning Optical Communications at a webinar hosted by Corning on Thursday.
The Rural Digital Opportunities Fund will offer $20.4 billion through a reverse auction scheme for broadband builders to help address the digital divide.
A reverse auction means that competitors will bid for the lowest amount of money from the Federal Communications Commission necessary to build out in a given census block.
The first phase of the two-part auction reserves $16 billion for “unserved” territories, which are defined as any census block that contains not a single resident with speeds of at least a 25 megabit download and 3-megabit upload.
The remaining funds will be reserved for what is called “underserved” territories. These are census blocks in which at least one resident meets the 25 down/3 up threshold defined by the FCC but are still severely lacking consistent broadband speeds.
There is much that is still yet unknown about the auction, participants said.
The only day that is “set in stone,” according to Mullaney, is the day of the actual auction, October 22, 2020.
Areas that are deemed eligible to participate in the auction by the FCC are expected to be announced in early June. Initial application materials are expected to be due by July. And grants should be announced by the end of the year.
The FCC will begin wiring funds in 2021 and will spread out the money over the course of 10 years.
“Everyone should have fiber in their network and their diet,” Mullaney said.
Mullaley touted three aspects of fiber that make it more favorable for building. The first she identified is longevity. “A fiber infrastructure would be one that is going to last past our lifetime and hopefully your children’s as well,” said Mullaney.
Secondly, the price of fiber “had dropped considerably,” Mullaney said, because the price of the components that go into fiber has gone down.
Third, fiber will create more opportunities for its users. Citing the Fiber Broadband Association, Mullaney said that fiber-to-the-home-enabled communities enjoy 46 percent better new business formation compared to communities without fiber broadband services.
Because of the growth that fiber provides, the FCC is likely to look favorably upon fiber builders as opposed to other types of builders when reviewing applications and providing grants, she said.
Mullaley also weighed in on rumors that the FCC is considering switching to counting census tracts, which are much larger than census blocks, as the smallest unit of auction for RDOF. “I doubt they will change the way the bidding is” conducted, Mullaley said.
John Curtis, R-Utah, Opens Up About Future of Fiber and Broadband Challenges
Utah Republican Rep. John Curtis speaks about broadband rollout, education and bills more than a year into the pandemic.
April 13, 2021 – Provo, Utah has made significant progress with its Google Fiber partnership, and representative John Curtis, R-Utah, hopes the federal government is paying attention.
Broadband Breakfast spoke with Curtis on Monday to discuss broadband and the lessons he’s taken from the pandemic. He said that the city of Provo is on track with its broadband efforts and that its programs are working. Having formerly served as city mayor for Provo from 2010 to 2017, Curtis oversaw the purchase by Google Fiber of iProvo, the city’s existing fiber internet network.
Announced in a press release on February 16, two of Curtis’ bills, the Federal Broadband Deployment in Unserved Areas Act, and the Rural Broadband Permitting Efficiency Act of 2021, were introduced to facilitate broadband deployment on federal lands and close the digital divide in both rural and urban areas. The bills called to “streamline permitting presses,” as duplicative regulations and inefficient practices have been hampering broadband development thus far, he said.
Federal, municipal regulations a constraint on deployment
Curtis was asked where he thought unnecessary red tape needed to be removed to fulfill rural and urban broadband objectives. He said 90 percent of the rural land in his district is owned by the federal government, making regulation heavy and complicated. In some instances, public lands have taken up to nine years to allow permitting for broadband, and in broadband terms, that’s a lifetime. “We don’t have nine years to get down into these parts of the district,” he said.
To visualize this, if there is an existing asphalt road, broadband cannot run alongside it because it is treated as if there was trench dug underneath Delicate Arch, a historical rock formation, a regulated territory. If rural roads are approved to be built, rural broadband should be approved in a similar and appropriate manner, Curtis said. He added companies like Google, who have vast resources, are still slowed down by the government.
And it’s not the federal government that is always behind roadblocks, but the municipal government can sometimes get in the way. A struggle over telecoms putting up equipment on municipal-owned poles, which are required for broadband and wireless deployment, has been playing out across the country.
Education needs support structure at home
As the country is more than one year into the pandemic, the importance of having adequate and affordable broadband in Utah households is critical, especially for education, Curtis said. Curtis said that the more disadvantaged a household is, the less likely it is to have good internet connectivity. While there are tremendous uses for virtual resources, Utah children need a support structure at home, and not every home has that.
Having poor support at home to stay connected for school, work, and health needs is virtually as bad as not even having a device to connect to the internet in the first place. A benefit of having Google Fiber in Provo, Curtis said, is that households see their internet costs come down and speeds go up as competition is benefitting consumers. Cities are averse to risk, and sometimes lack the capital to invest in broadband, but technology changes so fast that it requires constant upkeep, he said.
Not just about the money
Asked about his thoughts on recent federal legislation, including the $3.2-billion Emergency Broadband Benefit program and the Biden’s $100-billion infrastructure plan (Jobs Act) for broadband, Curtis said it is important to invest in these initiatives, but simply throwing money at the problem won’t solve anything.
He said he wished he could bring Biden to Provo to take a look at Provo’s broadband progress, adding that “creativity and hard work make up for a multitude of sins.”
Experts Weigh What Future Of Broadband Could Look Like Under Biden’s Infrastructure Plan
April 8, 2021 – Experts in Wednesday’s Broadband Breakfast Live Online event debated what “future-proofing” broadband could look like and whether President Joe Biden’s infrastructure plan can achieve it.
The White House’s new “American Jobs Plan” looks to fund $100 billion for broadband infrastructure in addition to other areas, and part of that plan “prioritizes building ‘future proof’ broadband infrastructure in unserved and underserved areas so that we finally reach 100 percent high-speed broadband coverage,” said a White House statement.
Carri Bennet, general counsel for the Rural Wireless Association, said at Wednesday’s event that fiber is essential for all types of networks. “We do mobile wireless, we do fixed wireless, we use all sorts of spectrum in our toolkit, and all of these wireless networks are connected to fiber at some point, somewhere,” she said.
But Bennet also said there are exciting developments for wireless that is not specifically fiber. “There are a lot of exciting things going on in the wireless world right now that could future-proof networks,” she said. “That’s using software and virtualized networks so that you don’t have to change out hardware on antennas on towers anymore.”
Open radio access networks (Open RAN) are such systems, which use open protocol wireless technologies that prevent the industry from relying on proprietary supplies generated by few companies. Bennet said open RAN is showing promise.
Sen. Mark Warner, D-Virginia, led a bipartisan effort Tuesday requesting $3 billion in Open RAN technology funding for the Biden administration’s annual budget request.
Doug Brake, director of broadband policy at the think tank Information Technology and Innovation Foundation, said Wednesday he believes the policy needs to technology neutral.
Legislation should be flexible to allow the best solutions for an area that are needed, he said. When ‘future proofing’ comes up, he said he is worried that fiber and cable become the focus. While fiber is really important to getting many unserved areas connected, we shouldn’t lock ourselves into a single tool — we want the flexibility to solve the problem as its needed, he said.
Municipal versus private broadband
Brake also expressed concern that Biden’s plan would prioritize funds for local municipal and co-op broadband.
“We really need to leverage our private providers, particularly private providers that have large economies that scale,” he said. While municipalities and co-ops are great at filling needed gaps, “they don’t scale well outside the jurisdiction, they don’t invest in [research and development] to develop new access technologies; they don’t contribute to standards,” he said.
But Gary Bolton, CEO of the Fiber Broadband Association, said Wednesday that, “We’ve seen first-hand the significant benefits and significant economic impact that fiber has when it’s deployed in communities,”. He referenced Chattanooga, Tennessee, the first city in America where gigabit-speed internet was offered in 2010. The city developed a municipally-owned fiber network that, according to a 2020 study by Bento Lobo at the University of Tennessee at Chattanooga, saw considerable return over the 10 years since its deployment.
“Fiber also delivers remote healthcare, online learning, public safety and provides a path for future services like 5G,” Bolton said.
On broadband affordability
Affordability is another piece of the broadband puzzle, and Biden’s proposal also seeks to address long-term cost issues. In a statement, the White House acknowledged the need for some short-term subsidies, but said that “continually providing subsidies to cover the cost of overpriced internet service is not the right long-term solution for consumers or taxpayers.”
Everyone needs to be able to afford broadband, Matt Wood, vice president of policy and general counsel at the advocacy organization Free Press, said Wednesday. “We want to talk about affordability and adoption, and we’ve done that in the mapping context, we’ve done it here, and I think that’s why this plan is so exciting to us,” he said.
Funding programs like the Emergency Broadband Benefit, and the focus on affordability and adoption in Rep. Jim Clyburn’s bill and the LIFT America Act are key, he said. This is not one of those, “if you build it, they will come” situations, he said. Building “fabulous networks” in rural and urban areas that people can’t afford to use should not be the infrastructure goal, he said.
Bolton expressed support for Biden’s proposal to address long-term affordability issues, but he wants to see funding done well. “It pains me to see so much precious stimulus money going to subsidize ridiculously expensive, poor-performing broadband such as satellite in rural areas,” he said.
The details of the American Jobs Plan are still being developed, and the White House is discussing those details with a variety of members of the broadband industry, according to Bolton.
Our Broadband Breakfast Live Online events take place every Wednesday at 12 Noon ET. You can watch the April 7, 2021, event on this page. You can also PARTICIPATE in the current Broadband Breakfast Live Online event. REGISTER HERE.
Wednesday, April 7, 2021, 12 Noon ET — “Billions and Billions: How to Spend Broadband Infrastructure”
On the heels of the Biden Administration’s unveiling of the American Jobs Plan, Broadband Breakfast will convene a special Broadband Breakfast Live Online event to take the pulse of the broadband industry on the core components of the administration plan:
- Build high-speed broadband infrastructure to reach 100 percent coverage. The administration’s plan prioritizes building “future proof” broadband infrastructure in unserved and underserved areas so that we finally reach 100 percent high-speed broadband coverage.
- Promote transparency and competition. President Biden’s plan will promote price transparency and competition among internet providers, including by lifting barriers that prevent municipally-owned or affiliated providers and rural electric co-ops from competing on an even playing field with private providers, and requiring internet providers to clearly disclose the prices they charge.
- Reduce the cost of broadband internet service and promote more widespread adoption.
This measure is expected to allocate $100 billion for broadband infrastructure and adoption. This panel will consider and discuss the broadband parameters of the Biden plan.
- Doug Brake, Director of Broadband and Spectrum Policy, Information Technology and Innovation Foundation (ITIF)
- Gary Bolton, President and CEO, the Fiber Broadband Association (FBA)
- Matt Wood, Vice President of Policy and General Counsel, Free Press
- Carri Bennet, Partner at Womble Bond Dickinson (US) LLP
- Drew Clark (moderator), Editor and Publisher, Broadband Breakfast
Doug Brake directs the Information Technology and Innovation Foundation’s work on broadband and spectrum policy. He writes extensively and speaks frequently to lawmakers, the news media, and other influential audiences on topics such as next-generation wireless, rural broadband infrastructure, and network neutrality. Brake is a recognized broadband policy expert, having testified numerous times before Congress, state legislatures, and regulatory commissions, as well as serving on the FCC’s Broadband Deployment Advisory Group.
Gary Bolton serves as president and CEO of the Fiber Broadband Association — the largest trade association in the Americas dedicated to all-fiber-optic broadband. With more than three decades in the telecom industry, Bolton joined the Fiber Broadband Association as president and CEO in 2020 after serving on the association’s board as vice chairman, treasurer and vice chairs of public policy and marketing committees. Prior to taking the leadership role at the Fiber Broadband Association, he spent 11 years at ADTRAN serving as vice president of global marketing and government affairs.
Matt Wood currently serves as Vice President of Policy and General Counsel at Free Press, where he helps shape the policy team’s efforts to protect the open internet, prevent media concentration, promote affordable broadband deployment and safeguard press freedom. Before joining Free Press, he worked at the public interest law firm Media Access Project and in the communications practice groups of two private law firms in Washington, D.C. He has also served as an expert witness before Congress on multiple occasions.
Carri Bennet is an outspoken advocate for small rural carriers, having battled with regulators and large companies for more than 30 years to ensure that small rural businesses have a seat at the table and a strong voice in Washington, DC. Bennet launched her own successful boutique communications and technology law firm prior to joining Womble Bond Dickinson in its Washington, DC office, and she also serves as outside counsel for the Rural Wireless Association and earlier as General Counsel and de facto chief operating officer of an international wireless carrier. She represents her clients before the FCC, state regulatory agencies, the courts and Congress, and she regularly testifies before the FCC, Congress and the courts on rural wireless issues and speaks regularly at industry trade shows and legal seminars on cybersecurity, data privacy, spectrum policy, universal service funding reform, and business development and strategy issues for communications and technology companies.
As with all Broadband Breakfast Live Online events, the FREE webcasts will take place at 12 Noon ET on Wednesday.
Christopher Mitchell: Electric Grid Disaster in Texas Leads to Broadband Open Access Soul Searching
The disaster in Texas resulting from an electric grid that was deliberately left exposed and likely to fail in rare cold weather events has received a lot of dramatic coverage, as well it should given the loss of life and damage to so many homes and businesses.
It also raised some questions in my mind regarding competition and designing markets that will be discussed below. Texas was a leader in allowing different electricity firms to compete in selling electricity over the same electric grid, an arrangement that has some similarities to open access broadband approaches.
In digging into that recent electricity history, I made another interesting and relevant finding that I discuss first as part of the background to understand the lessons from Texas. In 20 years of competing models between, on the one hand, municipal and cooperative structures to deliver electricity and, on the other hand, a largely deregulated and competitive market, the munis and co-ops delivered lower prices to ratepayers.
Electricity deregulation, Texas style
More than 20 years ago, Texas largely deregulated electricity markets. Residents still have a monopoly in charge of the physical wire delivering electricity to the home, but they could choose among various electricity providers that would effectively use the wire and charge different amounts, differentiating themselves via a variety of factors, including how the electricty was produced.
However, some areas continued to have monopoly electricity providers, including two of the largest public power providers in the nation, San Antonio’s CPS and Austin Energy, among others as well as several rural electric cooperatives.
For 20 years, Texas has conducted an informal test between unregulated market competition and local providers that are democratically accountable to their customers. The Wall Street Journal is the latest of many over the years to study the numbers and dispassionately annoint the munis and cooperatives the winners.
None of this was supposed to happen under deregulation. Backers of competition in the electricity-supply business promised it would lower prices for consumers who could shop around for the best deals, just as they do for cellphone service. The system would be an improvement over monopoly utilities, which have little incentive to innovate and provide better service to customers, supporters of deregulation said….
From 2004 through 2019, the annual rate for electricity from Texas’s traditional utilities was 8% lower, on average, than the nationwide average rate, while the rates of retail providers averaged 13% higher than the nationwide rate, according to the Journal’s analysis.
The findings are similar to a 2015 report from the Texas Coalition for Affordable Power, covered by the Texas Tribune:
But from 2002 to 2013, the average household in deregulated areas paid a total of about $4,800 more than residents of cities — like Austin and San Antonio — served by just one municipal utility, or those served by electric cooperatives, the analysis said.
Not just a question of price
This isn’t the first time we at ILSR’s Community Broadband Networks team have looked at electricity. Given that many of the arguments against municipal broadband are identical to arguments against public power more than 100 years ago, we like to look at the 100+ years of empirical evidence that local governments can handle these responsibilities.
Many studies looking at prices and reliability have found public power to be at least as good as the big investor-owned utilities, and often better. Back in 2011, I wrote about Connecticut Light and Power compared to Norwich, Connecticut after a storm demonstrated the benefits of community ownership.
Norwich had far fewer customers lose power, and they regained service more quickly than the investor-owned utility. It led to the New York Times digging into the two companies’ budgets to seek answers.
In contrast to Connecticut Light and Power, Norwich’s electric unit last year increased operations and maintenance spending by 11 percent, to $2.9 million. Put another way, in 2010 Norwich allocated about $132 a customer to this line item in its accounts. Connecticut Light and Power reported maintenance, unadjusted for deferred expenses, of $96.5 million, or around $78 per client.
We generally see networks that are directly accountable to their customers doing a much better job, not just in price but all-around value.
Lessons for designing markets competitively
The competitive market was supposed to deliver far lower prices to consumers. As several have stated, including ILSR’s very own energy expert, John Farrell, what it mostly did was allow electricity companies to introduce the tricky and opaque billing practices common among the national cable monopolies to what had been a fairly transparent market.
A 2019 Houston Chronicle article, “Analysis: The Murky and Confusing Texas Electricity Market” sheds some light:
But the shopping site became overwhelmed with offerings. Some companies offered more than 30 plans that were hard to distinguish from each other. Several retail electric providers began offering multi-tiered electricity plans with low teaser rates designed to catch the attention of shoppers, only to have those who signed up learn too late that using one kilowatt hour above a certain threshold would send the advertised price soaring by as much as 10 times.
Other companies offered “free nights and weekends” plans that could cost consumers more because of much higher weekday rates. One company offered a $600 bill credit for a two-year plan that would ultimately cost customers twice as much as another plan offered by the same company.
It is worth nothing that Texas was not solely seeking lower prices, but also incentives to encourage customers to shift their electricity use away from peak times, especially in the summer. Some companies have achieved those goals, but reading the investigations suggests that the bulk of energy in the market has been expended trying to fool potential customers with opaque pricing.
What this means is that rather than technical or other useful progress, the main innovation was in the form of legalized fraud or trickiness. Companies often competed in how they could fool people into signing up, though they would pay more. This is one of the biggest complaints people have today about telecommunications bundles that are hard to understand and often change price without adequate warning.
Open access broadband networks
As more municipal networks explore and iterate on open access models, proponents need to consider some of the recent lessons learned from Texas. To date, most ISPs on open access networks are earnest, small local companies with a variety of reasons to enter the business, though maximizing wealth extraction has not been one of them.
To my knowledge, I don’t see these shenanigans on UTOPIA despite it passing 120,000 premises. But what happens when open access networks pass 2 million potential users? Or 10 million?
I hope this issue won’t even arise, in part because I would expect the local ownership of the network to produce more accountability than a state or federal agency. But it wouldn’t hurt to have some rules regarding transparency of pricing or some mechanism to ensure the competition on these networks doesn’t devolve to harmful games.
These cable pricing dynamics aren’t just annoying. They are particularly pernicious for the lowest-income households that don’t have the time, and sometimes the literacy, to spend hours digging into complex pricing. Returning to the case of electricity and the Houston Chronicle’s “Murky” story:
“Too many Texans are still overpaying for power,” said Fred Anders, founder of Texas Power Guide in Houston, a website that helps consumers find the lowest cost plans. “And very likely a disproportionate share of them are people who can least afford to overpay and have less time and awareness to navigate the minefield of gimmicks in the electricity market.”
That story also has the interesting nugget that very few people are actively switching providers, which is supposedly the best way to keep prices low. A fatigue seems to set in rather than the kind of enthusiasm that might be expected from the heartiest fans of markets.
This reality is an important reminder when it comes to internet access: I believe people generally want “competition” when they are frustrated with their provider. I don’t think a survey of the subscribers to EPB in Chattanooga or NextLight in Longmont or US Internet in Minneapolis or Sonic in California would reveal much desire for more local competition because users there are happy to pay a fair rate for reliable and straightforward service.
I don’t think people want to spend their time trying to save another $2/month on internet access by checking in on the deals each week to change providers. If that would be all that open access could offer, I will be disappointed. Of course, it may be that for communities that do not want to offer retail service, offering the possibility of choice will result in better outcomes than if they chose a contract with a single ISP, so there are many factors to consider.
People want something that works transparently at a reasonable price. My enthusiasm for open access is very much tied up with the possibility of specialized niche services. Services that we have trouble imagining today because nearly all Americans are locked behind networks owned by corporate monopolies that are not open to innovation. Ammon’s genius is not merely the financial model but the courage to open so much power to users and ISPs. Time will tell if they do anything special with it.
I believe that valuable innovation will come from open platforms, but think the Texas lessons offered a chance to explore why as well as some potential hazards along the way.
Editor’s Note: This piece was authored by Christopher Mitchell, director of the Institute for Local Self Reliance’s Community Broadband Network Initiative. His work focuses on helping communities ensure that the telecommunications networks upon which they depend are accountable to the community. He was honored as one of the 2012 Top 25 in Public Sector Technology by Government Technology, which honors the top “Doers, Drivers, and Dreamers” in the nation each year. Originally published on MuniNetworks.org, this piece is part of a collaborative reporting effort between Broadband Breakfast and the Community Broadband Networks program at ILSR.
Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to [email protected]. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.
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