TPRC Panelists Discuss Backhaul Issues’ Impact on Broadband Expansion

Editor’s Note: This is the first of a series of panelist summary articles that BroadbandCensus.com will be reporting from the Telecommunications Policy Research Conference, September 25-27, at George Mason University School of Law in Arlington, Va.
ARLINGTON, Va., September 25, 2009 – Mobile broadband is the fastest growing segment of the broadband market. According to Jonathan Banks, who directs policy development for the telecommunications industry association US Telecom, the number of wireless broadband users is expected to grow 130% between 2008 and 2012.

These wireless networks rely on special access networks to connect cell towers to the network. This market also consists of financial institutions sending customer information from branches to main offices, as well as businesses processing credit card transactions.

The majority of these networks are run by incumbent local exchange carriers, which are often the sole provider of “special access” services, and which allows them to charge high rates for a relative low level of speed. The average connection speed is around 1.5 Megabits per second (Mbps) with a monthly cost of $390.

Panelists and participants in the event gravitated toward the position that the solution to this problem seems to be increased regulation by the Federal Communications Commission.

Currently, the FCC does regulate the special access market but only puts price controls on about one-third of it; while another one-third is able to have some price flexibility; the rest of the market is allowed to change prices, but is subject to FCC oversight.

Special access providers say that there is currently competition in the U.S., and that the FCC was correct in its decision to deregulate this market. By contrast, the users of the networks claim that in areas of full deregulation – where providers are able to change their prices – the prices never seems to decrease. True competition, they say, does not exist for the last mile.

Panelists for this event included:

• Dale Hatfield,Executive Director, Silicon Flatirons Center (Moderator)

Adjunct Professor, University of Colorado
Former Chief Engineer, Federal Communications Commission

• Charles McKee, Vice-President, Government Affairs, Federal & State Regulatory, for SprintNextel Corporation.

McKee is responsible for Sprint’s advocacy before the FCC and state public service commissions for all non-spectrum related regulatory matters.

• Jonathan Banks directs the USTelecom’s policy development, advocacy and legal work before the Federal Communications Commission, the Federal Trade Commission and the courts. Prior to joining USTelecom, Banks handled federal policy matters for BellSouth, and, prior to BellSouth, he worked on competition matters for the Federal Trade Commission.
• Colleen Boothby is a partner in the firm of Levine, Blaszak, Block & Boothby, LLP, which specializes in the representation of enterprise customers and providers of emerging information technologies. She joined the firm after ten years of service with the FCC, specializing in telecommunications issues.