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BEAD Letter of Credit Concern, Viasat joins Space Force, $7 Million FCC Connectivity Funding

Broadband experts express concern about letter of credit requirements for BEAD.

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Illustration from the U.S. Space Force

September 6, 2023 – A Wednesday letter from broadband industry is urging the Commerce agency to drop a requirement for providers to get a letter of credit from the bank to get funding from the Broadband Equity, Access and Deployment program and consider two alternatives. 

The group of some 300 signatories said in the letter to Alan Davidson, head of BEAD administrator National Telecommunications and Information Administration, and Commerce Secretary Gina Raimondo the credit requirement will leave out smaller community-based providers from access to funding. 

The requirement itself indicates that communities who apply for BEAD funding must procure a letter of credit equating to 25 percent of their grant award, meaning providers will need to back the credit with cash as collateral to compensate for the risk. It is a requirement that, some say, is difficult to meet for some smaller providers in rural and underserved areas. 

“While we support the NTIA’s intention of ensuring providers are accountable for delivering on grants, far from safeguarding taxpayer dollars, the LOC requirement will prevent the internet service providers (“ISPs”) best positioned to connect unserved and underserved Americans from participating,” the letter said, adding the requirement goes against the goal of the BEAD program’s promise of creating equitable access and improved broadband infrastructure in places that need it most. 

The letter argues for two alternatives: the issuance of performance bonds where providers guarantee the completion of a project; or delayed reimbursement, where money is incrementally disbursed to the provider when projects hit certain milestones. 

The letter was signed by associations including Connect Humanity, the American Association for Public Broadband, the Internet Society, the SHLB Coalition, the Benton Institute, Public Knowledge, Ready.net, and various state broadband offices. 

The letter follows another in August, wherein a coalition of more than 50 internet providers addressed NTIA about the same concern. 

Groups like the American Library Association, Consumer Reports and the SHLB Coalition have echoed these concerns in the past.

Viasat gets Space Force contract for its low earth orbit capacity 

Satellite company Viasat on Wednesday signed an agreement with the U.S. Space Force to provide capacity from its low earth orbit satellites. 

The proliferated LEO system allows for diversified orbits for multiple uses. LEO satellites fly closer to the earth to provide faster communications. 

“Under this contract, Viasat plans to leverage small satellite technology, reduced costs and increased launch service competition, facilitating the ability for pLEO constellations to provide persistent, global coverage with reduced transmission latency,” the company said in a press release. 

“The company will provide a suite of fully-managed pLEO satellite-based services and capabilities, to include space relay services, supplemented by GEO and NGSO satellites, supporting all domains – space, air, land, maritime and cyber,” it added. 

The contract comes on the heels of Viasat satellite malfunctions. The ViaSat-3 Americas, a broadband satellite launched in April, experienced a malfunction on July 12th, which was said to impair the functionality of the satellite. 

The government agency has entered into contracts with 16 other similar companies – namely  Hughes, which signed a five-year contract with Space Force in August. These $900 million contracts aim to improve space-based defense capabilities, by capitalizing on the advantages provided by these PLEOs’. 

FCC announced $7 million in connectivity funding for schools 

The Federal Communications Commission announced Wednesday that it will commit $7 million to the Emergency Connectivity Fund Program which provides digital learning tools and services to students nationwide. 

This increase in funding will impact nearly 50,000 students in 110 schools and school districts. Schools can use this funding in ways they see fit, whether that be supporting students off-campus or hosting summer learning programs to make sure kids are keeping up with their education. 

“Now that Labor Day has come and gone and schools are back in session, students everywhere need access to broadband connections and digital tools to succeed,” said FCC Chairwoman Jessica Rosenworcel.

The program was established in 2021 and has three application periods or ‘windows’ during which schools can apply for support. This funding in particular is being used to support applications that came through during the third application window this year. 

This program is part of a much larger initiative aimed at giving kids access to the digital tools they need to keep up with their peers and in doing so closing what scholars refer to as the ‘Homework Gap’.

In addition to this funding Chairwoman Rosenworcel announced her plan to install broadband on school buses to enhance connectivity going forward. 

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Broadband Roundup

No to E-Rate Changes, Millions for Tribal Broadband, Oregon Grants, Arkansas Training Program

GOP lawmakers want new FCC commissioner to reject E-Rate expansion.

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Screenshot of Anna Gomez, FCC commissioner.

September 28, 2023 – Rep. Cathy Rodgers, R-WA, and Sen. Ted Cruz, R-Texas, sent a joint letter on Tuesday to newly minted FCC commissioner Anna Gomez, urging her to reject proposed expansions to a school broadband subsidy.

FCC Chairwoman Jessica Rosenworcel announced plans in June to expand the program –which provides monthly internet discounts for schools and libraries – to fund Wi-Fi on school buses and Wi-Fi hotspots for students to check out from libraries and schools.

The GOP lawmakers expressed “strong opposition” to the plan, calling it a “mockery of the law.”

They argue the Communications Act of 1934 limits E-Rate benefits to school and library property, making both proposed expansions ineligible for the subsidy.

Senator Ed Markey, D-Mass., supported Rosenworcel’s June announcement.

The proposal will be up for a vote among the five FCC commissioners at the regulator’s October 19 open meeting. Gomez’s recent confirmation gives Democrats a 3-2 majority.

E-Rate is among four programs funded by a portion of the roughly $8 billion in annual money from the Universal Service Fund. Lawmakers are looking to reform the USF’s funding mechanism, which is currently a tax on voice providers.

NTIA announces latest tribal grants

The National Telecommunications and Information Administration announced on Wednesday $74 million in tribal broadband grants.

The money comes from the nearly $3 billion Tribal Broadband Connectivity Program. It can be used to expand infrastructure or to fund other connectivity efforts like feasibility studies and broadband adoption initiatives.

Over $1.8 billion has been allocated under the program with the latest round of awards, which goes to 28 tribal governments in 11 states.

The NTIA said the awards comply with its “equitable distribution” requirement. The agency is required to give smaller grants – up to $500,000 – to tribal governments who do not receive the full grant amount they apply for.

The Government Accountability Office has pushed the NTIA to offer feedback to tribes who are given these significantly reduced grants, saying it would help tribal governments submit more competitive applications in the future.

The remaining $970 million in the program is still up for allocation. Applications are due to the NTIA by January 24 of next year.

Oregon gets $156 million from Capital Projects Fund

The Treasury Department announced Thursday the approval of over $156 million from the Capital Projects Fund for broadband projects in Oregon.

The money will fund a competitive grant program for last-mile infrastructure which the state expects to ultimately connect over 17,000 locations. The program will prioritize projects in areas with current internet speeds of 10 Mbps download and 1 Mbps upload and below and will require all projects to deploy at least 100 * 20 Mbps.

Most of the funding – $149 million – will go to grant awards for successful bidders, with the remaining $7.7 million set aside for administrative costs. Oregon will not receive any additional money from the CPF.

Projects funded by the program will also be required to participate in the Affordable Connectivity Program, a monthly internet subsidy for low-income and Tribal households. The ACP’s future is uncertain, though, with its $14 billion set to dry up in April of next year.

This allocation puts the total CPF awards over $8.4 billion to date. A response to the Covid pandemic, the fund set aside $10 billion for projects enabling work, education, and health monitoring.

Arkansas fiber training program

The Arkansas Community Colleges recently announced a free training program for jobs in broadband infrastructure deployment.

The Arkansas Fiber Academy, subsidized by a partnership with the state’s Office of Skills Development, offers three training programs preparing participants to work as aerial linemen, telecom tower technicians, and underground fiber technicians.

Courses range from 11 days to over three weeks and can be attended at three colleges and universities across the state.

A shortage of qualified workers to deploy broadband infrastructure has been cited by the industry as a potential obstacle to the $42.5 billion Broadband Equity, Access and Deployment program.

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Broadband Roundup

Labels on IoT Devices, Lumos Fiber in South Carolina, Empire Access in Pennsylvania

In August the FCC proposed giving manufacturers the option of labeling their devices with a cybersecurity standard.

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September 27, 2023 – The CEO of a software company called Seam said the Federal Communication Commissions should incorporate as part of the agency’s cybersecurity labeling program, letting device users know the countries where their data is sent and stored.

“For instance, if an IoT device routes or stores its data in China, this should be explicitly mentioned on the label” read a September 19 letter from Seam CEO Sy Bohy logged in the FCC’s ex parte communications docket. Bohy was referring to Internet-of-Things devices for machine-to-machine communication.

In August, the FCC proposed a voluntary program that would give manufacturers the option of labeling their devices with a government approved seal should they adhere to “baseline cybersecurity criteria.”

That criteria were developed by the Commerce Department’s National Institute of Standards and Technology. It looks at how devices handle data protection, information dissemination, product education awareness and cybersecurity state awareness.

In its August proposal, the FCC sought comment on how to best translate those qualities to the consumer and inquired about any other factors they should consider when looking at what devices would qualify for a label.

Bohy, in his communications with the office of Commissioner Nathan Simington, also warned the FCC that certain manufacturers “intentionally…hide the fact that their data is located or transiting through a foreign jurisdiction, particularly those with dubious or lax data privacy regulations.”

Putting a cybersecurity label on devices would provide consumers and businesses with necessary transparency and information needed to make smart purchases, Bohy said.

The need for something like a security label has been an important topic talked about amongst regulators for some time now. At January’s CES tech trade show, policymakers and cybersecurity experts stressed the importance of consumers being able to make smart decisions about buying secure technologies.

Lumos gets franchise to deploy broadband into South Carolina 

On Wednesday Lumos, an internet service provider received franchise approval to deploy fiber optic services by the cities of Columbia, West Columbia and Irmo, South Carolina.

This approval will allow Lumos to provide these areas with access to high-speed fiber optic networks, the company said.

Outside of building fiber infrastructure, Lumos has also agreed to provide free internet service to certain public parks and recreational areas in the Columbia and Irmo areas.

This expansion is part of Lumos’ $100 million investment in deploying broadband across the state, according to the company.

“Today’s announcement is a testament to the ongoing support from state and local representatives to expand our lightning-fast fiber internet services” said Lumos CEO Brian Stading.

Empire Access starts broadband construction in Pennsylvania

Fiber internet service provider Empire Access announced on Wednesday that it had started construction of an 86-mile fiber build in Scranton, Pennsylvania, The company said it expected to finish construction by the end of the year.

This phase of construction is set to be followed by another 90 miles of fiber buildout to be completed in 2024.

The entire build out is part of a larger broadband deployment strategy ranging from the southern part of New York into Northern Pennsylvania, said Empire Access CEO Jim Baase.

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FTC and 17 States Sue Amazon, Gomez Sworn in at FCC, South Central Broadband

The FTC complaint alleges anti-discounting measures that deter sellers from offering lower prices.

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Photo of FTC Chair Lina Khan

September 26, 2023 – The Federal Trade Commission and 17 state attorney generals filed an antitrust lawsuit against Amazon on Tuesday alleging that online retail utilizes anticompetitive and unfair strategies to illegally maintain its dominance in e-commerce.  

The FTC and the states said that the global conglomerate is breaking the law through engaging in exclusionary conduct that prevents other companies from growing or emerging. It also cites that by constraining the competition through “price, product selection, quality, and preventing its current or future rivals from attracting a critical mass of shoppers and sellers” Amazon is ensuring there is no threat to its dominance. 

“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” FTC Chair Lina Khan said. “The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them. Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition.”

The FTC and states alleged that Amazon’s “anticompetitive conduct” occurs in the online superstore market and the market for online marketplace services. The tactics include, according to the complaint, “anti-discounting measures that punish sellers and deter other online retailers from offering prices lower than Amazon” and “conditioning sellers’ ability to obtain ‘Prime’ eligibility for their products,” which has limited their competitors’ ability to compete against. 

Additionally, the FTC and states cite Amazon’s overwhelming amount of paid advertisements, search results which favor their own products, and costly sellers’ fees as “enormous monopoly rents from everyone in its reach.” 

In a public statement responding to the lawsuit, Center for Law & Economics President and Founder Geoffrey A. Manne stated that it was “expected” but also argued that the “extreme demands greatly undermine the chances that the agency will prevail in court.”

“The case could greatly harm consumers, all in an attempt to shift the course of U.S. antitrust policy against the will of Congress and the courts,” said Manne.

The 17 states that joined the lawsuit are Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, and Wisconsin. 

Gomez sworn in as FCC Commissioner, appoints staff members

Anna Gomez on Monday was sworn in as an FCC Commissioner and announced the appointment of four staff members to her office.

“I am humbled and honored that President Biden and the United States Senate have entrusted me with the privilege to serve the people of the United States as a Commissioner of the Federal Communications Commission,” Gomez said. “I look forward to working with Congress, Chairwoman Rosenworcel, my fellow Commissioners, and the talented and dedicated FCC staff to ensure that every person in every community, of every geography and income, has access to modern telecommunications services.”  

Gomez’s staff will consist of Deena Shetler, acting chief of staff and legal advisor for media and international, Edyael Casaperalta, acting legal advisor for wireless, public safety and consumer protection, Hayley Steffen, acting legal advisor for wireline and space, and Anna Holland, acting executive assistant.  

“I am elated that these dedicated talented public servants have agreed to join my office,” Gomez said. “They bring extensive experience in communications policy, the Commission, and working with its broad range of stakeholders. I know they will provide outstanding advice and I look forward to getting to work with them to ensure the Commission’s actions meet the needs of all people.”

With Gomez now sworn in as a commissioner, Democrats at the FCC now have a 3-2 majority. 

Internet providers merge to create broadband company serving Arkansas, Oklahoma, and Texas 

Two internet service providers, 360 Communications and 903 Broadband, have merged together to create a new company, 360 Broadband, announced Thursday. 

360 Broadband’s mission is to provide affordable data, reliable voice and other related services to states in the South Central Region. The states receiving service are Oklahoma, where 360 Communications originated from, Texas, home of the former 903 Broadband, and Arkansas.

Upon merging in August, 360 Broadband had roughly 16,000 subscribers and 88 employees over 10,000 square miles and 30 counties, 20 in Oklahoma, six in Texas, and four in Arkansas. The company has an overall goal of reaching 50,000 subscribers in the three states.

“We are delighted to join forces to provide a high-quality, reliable broadband experience in rural and smalltown areas of Oklahoma, Texas, and Arkansas,” said George Breeden, CEO of 360 Broadband. 

Company officials said that will seek to receive local, state, and federal funding for rural broadband network expansions. 360 Broadband received over $33 million in private financing from Oklahoma City-based Fischer Industries.

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