Connect with us

Expert Opinion

Kristian Stout: Costs For Pole Attachments Should be Shared by Utilities and New Broadband Entrants

Published

on

The author of this Expert Opinion is Kristian Stout, associate director of the International Center for Law and Economics

From policymakers to industry and consumers, everyone wants fast broadband internet in their homes, particularly in the wake of the COVID-19 pandemic. Not many, however, wish to consider the complicated tradeoffs that broadband companies need to make to bring this desire into reality.

One of the more mundane considerations harkens back to the mid-20th Century: who should pay for access to and the maintenance of utility poles? The lack of a clear answer to that question is leading to delayed broadband rollout, or else increased prices for consumers, especially in rural areas.

The problem is simple: broadband providers need access to utility poles to run the wires necessary to provide service. The cost of access to those poles varies dramatically and can balloon the cost of a project to extend service. The Federal Communications Commission has an opportunity to improve how these costs are managed and, therefore, to enhance the overall prospects of broadband deployment.

Currently, there is a petition pending before the FCC that asks it to examine the “just and reasonable” apportionment of pole maintenance and replacement costs between the broadband providers and poles owned by investor-owned utilities.

Getting that balance right is vital given that current estimates suggest that as much as twenty-five percent of the cost of deployment in rural areas comes from broadband providers dealing with pole replacement and upgrade issues. That’s a massive expense.

The phenomenon isn’t surprising given the incentives involved. With the certain knowledge that broadband providers will need access to poles, pole owners allow some substantial portion of their pole inventory to remain in use after their useful life has ended.

Thus, when those providers want to add their equipment to those poles, the owners seek to offload the cost of replacing or repairing the poles onto the attachers. In other cases, pole owners make demands for a variety of improvements to existing poles that are not quite past their useful lifespan before new equipment can be installed.

The net effect of these inequitable practices is the enrichment of pole owners, not just at the expense of broadband providers, but also at the expense of consumers — since broadband providers must necessarily pass along at least some of this cost.

And even where the cost is partially internalized by the broadband provider, this cost-shifting from pole owners to broadband providers forces a tradeoff which, in the end, results in slower and more expensive rollout. This ultimately results in rural customers receiving speed upgrades more slowly than their suburban and urban counterparts, while facing potentially higher prices when those upgrades happen.

Allowing this situation to go on only encourages pole owners to continue to shift costs and introduce delays, to the detriment of consumers. This problem spills over into many areas. For instance, both the current administration, as well as the Biden campaign have announced 5G deployment as an important priority. This bipartisan vision can only be realized if the cost of installing networking equipment is not inflated by pole owners seeking to offload their own costs.

Even a rudimentary understanding of economics demonstrates that the pace of broadband rollout is contingent upon its cost. The more expensive deployment becomes, necessarily, the more difficult it is to realize sustainable profits on that deployment. This dynamic invariably leads to a more selective use of scarce resources to the detriment of rural deployment.

The central question the FCC needs to consider is how best to properly incentivize the economically efficient rollout of broadband on existing infrastructure in order to ensure deployment as quickly as possible. That means enacting rules that require equitable sharing of such burdens. It is not every day that the FCC can undertake such seemingly small steps while having such an outsized impact on closing the digital divide.

Kristian Stout is Associate Director at the International Center for Law and Economics, a nonprofit, nonpartisan research center that promotes the use of law and economic methodologies to inform public policy debates, support consumer welfare and promote global economic growth. Kristian’s research focuses on intellectual property, antitrust, telecommunications, and Internet governance. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published.

Digital Inclusion

Doug Lodder: How to Prevent the Economic Climate from Worsening the Digital Divide

There are government programs created to shrink the digital divide, but not many Americans know what’s out there.

Published

on

The author of this Expert Opinion is Doug Lodder, president of TruConnect

From gas to groceries to rent, prices are rocketing faster than they have in decades. This leaves many American families without the means to pay for essentials, including cellphone and internet services. In fact, the Center on Poverty and Social Policy reports that poverty rates have been steadily climbing since March. We’re talking about millions of people at risk of being left behind in the gulf between those who have access to connectivity and those who don’t.

We must not allow this digital divide to grow in the wake of the current economic climate. There is so much more at stake here than simply access to the internet or owning a smartphone.

What’s at stake if the digital divide worsens

Our reliance on connectivity has been growing steadily for years, and the pandemic only accelerated our dependence. Having a cell phone or internet access are no longer luxuries, they are vital necessities.

When a low-income American doesn’t have access to connectivity, they are put at an even greater disadvantage. They are limited in their ability to seek and apply for a job, they don’t have the option of convenient and cost-effective telehealth, opportunities for education shrink, and accessing social programs becomes more difficult. I haven’t even mentioned the social benefits that connectivity gives us humans—it’s natural to want to call our friends and families, and for many, necessary to share news or updates. The loss or absence of connectivity can easily create a snowball effect, compounding challenges for low-income Americans.

The stakes are certainly high. Thankfully, there are government programs created to shrink the digital divide. The challenge is that not many Americans know what’s out there.

What can be done to improve it

In the 1980s, the Reagan administration created the federal Lifeline program to subsidize phones and bring them into every household. The program has since evolved to include mobile and broadband services.

More than 34 million low-income Americans are eligible for subsidized cell phones and internet access through the Lifeline program. Unfortunately, only 1 in 5 eligible people are taking advantage of the program because most qualified Americans don’t even know the program exists.

The situation is similar with the FCC’s Affordable Connectivity Program, another federal government program aimed at bringing connectivity to low-income Americans. Through ACP, qualifying households can get connected by answering a few simple questions and submitting eligibility documents.

Experts estimate that 48 million households—or nearly 40% of households in the country—qualify for the ACP. But, just like Lifeline, too few Americans are taking advantage of the program.

So, what can be done to increase the use of these programs and close the digital divide?

Our vision of true digital equity is where every American is connected through a diverse network of solutions. This means we can’t rely solely on fixed terrestrial. According to research from Pew, 27% of people earning less than $30,000 a year did not have home broadband and relied on smartphones for connectivity. Another benefit of mobile connectivity—more Americans have access to it. FCC data shows that 99.9% of Americans live in an LTE coverage area, whereas only 94% of the country has access to fixed terrestrial broadband where they live.

Additionally, we need more local communities to get behind these programs and proactively market them. We should see ads plastered across billboards and buses in the most impacted areas. Companies like ours, which provide services subsidized through Lifeline and ACP, market and promote the programs, but we’re limited in our reach. It’s imperative that local communities and their governments invest more resources to promote Lifeline, ACP and other connectivity programs.

While there’s no panacea for the problem at hand, it is imperative that we all do our part, especially as the economic climate threatens to grow the digital divide. The fate of millions of Americans is at stake.

Doug Lodder in President of TruConnect, a mobile provider that offers eligible consumers unlimited talk, text, and data, a free Android smartphone, free shipping, and access to over 10 million Wi-Fi hotspots; free international calling to Mexico, Canada, South Korea, China and Vietnam; plus an option to purchase tablets at $10.01. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

Continue Reading

Expert Opinion

Craig Settles: If You Can’t Give Away Free Internet, Consider Telehealth

Settles suggests tactics for communities to effectively deploy telehealth services while marketing the Affordable Connectivity Program.

Published

on

The author of this Expert Opinion is Craig Settles, who unites community broadband teams and healthcare stakeholders through telehealth-broadband integration initiatives.

Vice President Kamala Harris personally rallied the state governors – “it’s all hands on deck” to sign up more households to the Federal Communications Commission’s Affordable Connectivity Program (ACP). This Friday, the FCC likely will authorize a $100-million grant program to help boost the numbers. The White House went online nationwide to energize community stakeholders and activists.

What’s up? ACP is a free monthly internet program with a $100 subsidy for a computing device. So far, about 12 million households have signed up for ACP. However, the National Telecommunications and Information Administration’s “Internet For All” website estimates there are more than 51 millions ACP-eligible homes. Thirty-nine million homes can be a significant reach.

“ACP adoption has been difficult because there is no money to help those of us who are managing the process and who have the connections to the community,’ says Deb Socia, president and CEO of The Enterprise Center, a local Chattanooga economic development partner. “I have a full-time person just to help get folks signed up, but I had to raise money to do so.”

Hopefully this Friday the FCC will “green light” what they’re calling “Your Home, Your Internet.” Socia and many others can hire more people who know the communities and neighborhoods well. However, the key to increasing participation in the ACP is not more money! Rather, the key is more money spent more wisely.

The great thing about marketing is…it works!

Before community broadband, I did marketing and PR consulting for industry giants such as Lotus Development, Microsoft, and AT&T and a bunch of high-tech startups. These companies knew that a successful marketing tactic was (and still is) to let prospects demo products in a real-world environment. Whether a game or a business technology, demo it.

ACP’s markets are heavily low-income homes. Communities text, back-pack flyers, and bus stop-ads must compete for attention with 6,000 – 10,000 marketing messages per person per day, kids crying, adults whining, racing off to the third job, etc. Parents worrying about where the family’s next meal is coming from, kids worrying about getting shot. What’s more, sizeable portions of the left-leaning residents fear government or incumbent net intrusion, surveillance, or bait-and-switch scams, conservatives seem to distrust anything Democrat-sponsored.

A winning demo? Telehealth. Because everybody gets sick sometimes – low-income folks, a hell of a lot more than everybody else. Often, they’re also responsible for others who are sick. So let “Telehealth and convenient healthcare delivery” be the marketing message that drives ACP.

The Enterprise Center is planning a pilot project involving 1000 free telehealth appointment targeted to one of Chattanooga’s lowest income neighborhoods. They have high incidences of stroke, heart disease, diabetes, and asthma. The pilot includes training, a new Chromebook, and home internet access that residents’ their needs.

Six tactics for communities to deploy telehealth and market the ACP

Here are six tactics that communities can use to deploy telehealth while putting some order, shape, and priority to ACP adoption. Develop statewide media campaigns that build marketing awareness and excitement for community needs assessments for NITA’s BEAD and DEA grant programs.

1. Reinventing the doctor office visit for various healthcare practices, including doctor consults, medical observation, screening, and data gathering and exchange. For example, recruit barbershops, hair salons, churches, and laundromats in African-American neighborhoods where hypertension screening services are delivered, and customers, parishioners, patrons and others then can sign up for ACP and telehealth.

2. Use telehealth to deliver chronic healthcare and home care so the constant appointments and treatments can be made less intrusively at home, or possibly at work. Hospitals, doctor practices, and clinics can prescribe telehealth solutions and give patients material for signing up for ACP and computing devices from an ISP. Some hospitals are giving they are chronic illness patients computing devices.

3. Enhance emergency response to save more lives. Perhaps some of the facilities can treat non-serious patients (those who treat the ER as their primary care physician), and then give them ACP and telehealth paperwork so an ISP can sign up patients.

4. Expand efficiency of mental healthcare delivery. Now might be a good opportunity to pilot program that gives police officers several emergency URLs so they can get mental health professionals on the line to deescalate situations, and direct people with mental health crisis into the ACP when possible. It may not produce huge numbers of ACP sign ups, but it’s great publicity for the ACP and telehealth.

5. Improve senior care and facilitating aging in place. Enabling several senior citizens centers and libraries to deliver a series of appropriate screenings for seniors, followed by demonstrations of telehealth, digital literacy, and ACP sign-ups could be awesome.

6. Reimagining what hospital care can be. Various cities may want to consider equipping two or three public housing units so they can become mobile telehealth clinics.

Next time I will address setting up a campaign to recruit, coordinate, and motivate unofficial community leaders in the implementation of these various tactics. These unofficial leaders carry significant clout in their respective communities – barbershops, hairdressers, local grocery store owners, pastors, libraries etc.

Craig Settles conducts needs analyses, planning, and grant assessments with community stakeholders who want broadband networks and telehealth to improve economic development, healthcare, education and local government. 

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views reflected in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC. This Expert Opinion was lightly edited to conform with Broadband Breakfast style. 

Continue Reading

Expert Opinion

Dave Wright: Shared Relocation Fund Will Make More of Finite Spectrum Resource

‘Wireless connectivity is one of the most vital aspects of our digital infrastructure.’

Published

on

The Author of this Expert Opinion is Dave Wright, president of OnGo Alliance and head of global wireless policy at Hewlett Packard Enterprise

In order to meet the gaps in broadband connectivity that persist throughout the country, we must have a more comprehensive view for the necessity of all available spectrum – whether shared, licensed or unlicensed – understanding that they are complementary and independently important to our nation’s future.

As we figure out how we will meet the needs of an increasingly wireless world, it is critical that we think collaboratively on how we can free up and share spectrum, working closely and cooperatively with the federal agencies responsible for our nation’s spectrum resources, the Federal Communications Commission and the National Telecommunication and Information Administration.

With recent confirmed leadership appointments in the NTIA and FCC, and renewed focus on collaboration and collegiality between these organizations, there is hope for renewed effectiveness in America’s overall management of our spectrum resources.

From a policy perspective, the OnGo Alliance is working to shed light on the incentives that inherently exist around the way spectrum is made available today. For terrestrial uses, there are two long established methods for making spectrum available – via a licensing process including an auction of the frequencies, or via an unlicensed allocation where spectrum is made available on a license-exempt basis.

Licensed bands have given rise to our cellular connectivity, while unlicensed spectrum has enabled innovations like the Wi-Fi and Bluetooth solutions that we know and depend upon today. The near ubiquitous presence of these technologies speaks to the efficacy of these approaches. The US 3.5 GHz Citizens Broadband Radio Service is the first spectrum access framework that combines aspects of licensed (protected access) and unlicensed (opportunistic access) spectrum within a single, dynamically managed access paradigm.

Congress has increasingly been looking to licensed spectrum auctions as a source of revenue to cover the funding requirements for new programs. And Federal users who are occupying spectrum and then make the spectrum available for auction can take advantage of monies made available through the Spectrum Relocation Fund to cover the costs associated with transitioning their systems.

The SRF is in turn funded based the resulting auction revenues. These are examples of the current incentives in the system which are either directly or indirectly tied to auction revenues of licensed spectrum. These incentives inherently bias the policymaking processes toward licensed spectrum, at the expense of unlicensed and/or opportunistic spectrum like we have in the CBRS General Authorized Access tier.

This bias is not helpful in our quest to provide accessible broadband throughout the nation as unlicensed and GAA are key components in most solutions, from Wi-Fi as the “last meter” connection to a fixed broadband network to GAA’s prominent role in rural fixed wireless offerings.

CBRS is an optimal framework for putting mid-band spectrum to intensive uses for a wide variety of uses. In the only two years since CBRS commercial operations were approved by the FCC, over 225,000 CBRS base stations have been installed nationwide.

Collaboration between cloud players, system integrators, radio vendors and operators has reached critical mass, building a vibrant, self-sustaining ecosystem. CBRS has allowed enterprises and rural farms alike the opportunity to install private 4G and 5G networks that are connecting IoT devices – from factory robots to autonomous farm equipment. School districts, airports, military bases and logistics facilities, factories, hospitals, office buildings, and public libraries are only but a few of the limitless facilities where connectivity has been enabled by CBRS spectrum.

Wireless connectivity is one of the most vital aspects of our digital infrastructure, and we must use all of the available resources in order to make broadband as ubiquitous as any other utility. Our policymaking, and the incentives around it, must account for the fact that all types of spectrum are important – whether licensed, unlicensed or shared – and that it is vital to ensure that there are proper allocations of each type to meet the relentless demand. We must work together to make the most of what we have.

Dave Wright played an instrumental role in the formation of the OnGo Alliance (originally known as the CBRS Alliance), collaborating with other founding members to create a robust multi-stakeholder organization focused on the optimization of LTE and 5G services in the CBRS band. He served as the Alliance’s first Secretary from its launch in August 2016 and was elected as the President of the Alliance in February 2018. He advocates for unlicensed, licensed, and dynamic sharing frameworks – recognizing the vital role that all spectrum management regimes play in our increasingly wireless world. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

Continue Reading

Recent

Signup for Broadband Breakfast

Get twice-weekly Breakfast Media news alerts.
* = required field

Trending