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Is the FCC’s Broadband Deployment Inquiry a Sham?

Posted by Andrew Regitsky

Aug 18, 2017 10:00:00 AM

broadband computer.jpgI’m done giving the FCC the benefit of the doubt. Because of the many years I spent dealing with the ambiguity and costs of Title II, I defended Chairman Pai and company when they sought to reclassify broadband Internet access service as a Title I information service in the net neutrality proceeding, although I have my qualms about eliminating the Internet bright line rules.

I never questioned the Commission’s motives when it proposed eliminating some of the restrictions on the pricing of ILEC special access services, although the competitive market test it used to justify deregulation cannot be taken seriously.

But I am now beginning to wonder if the consumer advocates are correct and this Commission is simply there as public defenders of the large ISPs/ telephone companies?

This week it was announced that the FCC had selected only two local officials for its newly formed advisory group on broadband deployment, with the clear majority of the 30-person group consisting of industry representatives and free-market economists. That was bad enough.

Now, the Commission’s newly released inquiry into broadband deployment is close to the last straw for me. As required by section 706 of the Telecommunications Act, the FCC must determine and report annually on “whether advanced telecommunications capability is being deployed to all Americans in a reasonable and timely fashion.” The FCC fulfilled this requirement with the release on August 8, 2017 of a Notice of Inquiry (NOI) in Docket 17-199. In the NOI, the Commission seeks a fresh start on this issue by stating that it would ignore last year’s NOI and collect fresh data this year:

We intend to conduct this Inquiry by orienting it toward evaluating whether the progress being made in the deployment of advanced telecommunications capability is occurring in a reasonable and timely fashion. We believe this is the most faithful approach to fulfilling this requirement in the statute. We seek comment in this Notice of Inquiry on the appropriate metrics and benchmarks by which to measure the deployment of both fixed and mobile services in order to evaluate the extent to which American consumers have access to advanced telecommunications capability. (NOI, para. 4)

All well and good so far, but as Commissioner Mignon Clyburn points out in her concurring statement, there are many problems in the proposals the FCC makes in the NOI. First, the Commission proposes to make the availability of either fixed or mobile broadband in an area sufficient to meet the requirement that broadband is available. However, as Clyborn notes, some consumers have only a mobile broadband connection because they cannot afford fixed broadband.

[W]e seek comment on whether to deem an area as “served” if mobile or fixed service is available. I am extremely skeptical of this line of inquiry. Consumers who are mobile only often find themselves in such a position, not by choice but because they cannot afford a fixed connection. Today, mobile and fixed broadband are complements, not substitutes. They are very different in terms of both the nuts and bolts of how the networks operate, and how they are marketed to customers, including both from the perspective of speed and data usage. I have heard from too many consumers who can only afford a mobile connection, and even then they have to drop service in the middle of the month because they cannot afford to pay for more data.  

Moreover, fixed broadband is much more useful for students doing homework, anyone doing research or for anything requiring moving from screen to screen. Mobile broadband is generally slower and more expensive than fixed broadband. Thus, while it would be costlier for ISPs to offer affordable fixed broadband everywhere, that ought to be the goal, and after all that is what the Connect America Fund was created for.

Second, the Commission proposes to continue to with the current speed benchmark of 25 Mbps download, 3 Mbps upload (25 Mbps/3 Mbps) for fixed broadband while establishing for the first time a mobile speed benchmark of 10 Mbps/1 Mbps. It also asks whether it would be appropriate to establish a speed benchmark based on the speed consumers are purchasing rather than on what they may really need. Clyborn demolishes both these proposals:

We sell consumers short by proposing a speed benchmark that is way too low. The statute defines advanced telecommunications capability as broadband that is capable of “originat[ing] and receiv[ing] high-quality voice, data, graphics, and video telecommunications.” High-definition video conferencing is squarely within the rubric of “originating and receiving high-quality . . . video telecommunications,” yet the 25/3 Mbps standard we propose would not even allow for a single stream of 1080p video conferencing, much less 4K video conferencing.101 This does not even consider that multiple devices are likely utilizing a single fixed connection, or the multiple uses of a mobile device.

[T]his Notice of Inquiry (NOI) falls into a precarious chicken-and-egg dilemma by seeking comment on whether the Commission should establish a speed benchmark based on the speed tier consumers are subscribing to. This presupposes that consumers are getting the services they want at the prices they want, and are not constrained by network limitations and terms of service…If only 25/3 Mbps service and nothing more was offered, and that was all consumers could subscribe to, we could select that as a benchmark and declare advanced telecommunications capability to be reasonably and timely deployed. This also seems contrary to the language of the statute.

Most egregiously, if the Commission establishes a 10 Mbps/1 Mbps speed requirement for mobile broadband and then declares mobile broadband as a substitute for fixed broadband, many consumers would be locked into the lower speed as their only broadband available.

Of course, we don’t yet know what the FCC will conclude in this proceeding. However, there are too many proposals offered that would clearly not benefit consumers, but instead, would make life easier (and more profitable) for the large ISPs. Industry comments on the NOI are due on September 7th. It will be interesting to see both the industry and consumer responses.  

By Andy Regitsky, CCMI

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Topics: regulatory updates, FCC, Net Neutrality, Broadband