Transcript: Community Broadband Bits Episode 467

This is the transcript for episode 467 of the Community Broadband Bits podcast. On this episode, we're joined by Sascha Meinrath, Palmer Chair in Telecommunications at Pennsylvania State University and Director of X-Labs.

The two discuss an exciting collaboration they are working on with Consumer Reports and other allied organizations that crowdsources monthly Internet bills from actual users. The aim of the project is to look at the differentials in the speeds and prices ISPs offer across a variety of geographical locations to see if there is a correlation around race, class, and location. The findings will hopefully clarify the problems and solutions around digital equity and steer policy-making, regulatory authority and consumer protection law conversations to improve Internet access for all. Listen to the podcast here or read the transcript below.

Sasha Meinrath: We really want people to be able to make informed decisions, apples to apples comparisons, between the offerings of different Internet service providers.

Christopher Mitchell: Welcome to another episode of the Community Broadband Bits podcast. I'm Christopher Mitchell at the Institute for Local Self Reliance. Today, I'm speaking with Sasha Meinrath, the director of X Labs and the Palmer Chair in telecommunications, not just communications, but telecommunications at Penn State.

Christopher Mitchell: Sasha, it's been too long. You've been on a few times before. It's great to talk to you.

Sasha Meinrath: It is awesome to be here again and I can't wait for what crazy shenanigans were going to get up to.

Christopher Mitchell: Yes. And let me just say first that you did not hear an introduction to this podcast, noble listener, because I think we're going to streamline things and for future episodes of Community Broadband Bits, take a few process pieces out and just make it a little easier to manage. So, you'll probably just hear me launching in and you won't have a short summary of what you're about to hear. It's going to be a surprise to you.

Christopher Mitchell: We take listener feedback seriously, though. If it's important to you that we have someone introduce the show and preview it, then we will bring that back. And as proof that we take listener feedback seriously, I have jumped into a lake several times this year. So, we read your notes and we listen to them.

Christopher Mitchell: Sasha and I are going to talk about some current events. Some of the things that are happening nationally around broadband and the first is... I feel bad. When I invited you to talk about this, I felt like we should invite John from Consumer Reports because we're going to talk about this awesome thing that he's doing that we helped with. So, let's just take all the credit. Consumer Reports and a bunch of other allied organizations are collecting bills. What's going on, Sasha?

Sasha Meinrath: Yeah. So, Jonathan Schwantes has been leading the charge over at Consumer Reports and I've been more of an instigator helping get this off the ground. And we'll be diving into data in the next six months. Now, data over what? Well, what we've done, which has never been done before is Crowdsource the collection of information about what people are actually paying directly from the bills of Internet service providers. So, we get away from the, he said, she said, what the costs are. We're saying, "Look, we're just going to take the numbers that people are actually paying every month and find out in essence, not only what are people paying, but where are their differentials between what people are paying?" And because we are doing things like also running a broadband speed test and collecting demographic information, we'll be able to look at, not only what are people paying, but are people getting what they've paid for?

3:12

Sasha Meinrath: i.e. If they're in a specific service tier, are they getting that service tier and are there differentials, in essence, between the differential? So, just to say, "Are certain people getting closer to what they're paying for than others? And if so, who are those lucky ISP customers?" And I think this really represents the first time that we're able to shine some sunlight onto what is a nefariously opaque realm, which is to say, "We're buying services but we don't really know what those services are. What's an up to speed?" And we're paying money but nobody knows. It's like, nobody wants to talk about what other people are paying for exactly the same service.

Christopher Mitchell: Well, this is where I wanted to say you are a bit of a fan girl of statistics. What do you think the distribution is going to look like if you basically say like, for the people who are getting a hundred megabits or so. What do you think the distribution is going to look like in terms of how much people are paying for that?

Sasha Meinrath: So, I think we're going to see some pretty widespread distributions. And I say that because we've already collected a bunch of information at the state level for the State of Pennsylvania. The legislature, here two years ago, hired me and my team to look into broadband pricing in Pennsylvania. We found widespread discrepancies in what people were paying for the same service across the state. And this won't shock anyone. And it won't shock anyone to see that these differentials really aligned with the rural urban divide, which is basically if you're not in a city then you're paying more than your city compatriots. What is shocking is the levels at which those differentials exists. Which is to say, imagine any other commodity that we're told costs more to transport long distances like gasoline, right? It takes a lot more money to transport gasoline than bits, frankly. But if we had the kind of markups and differentials between gas, it would be like you paying $3 a gallon and me paying $30 a gallon. And people would say, "What? Hold on a second!"

5:37

Christopher Mitchell: Yeah. Well, actually, I think you're understating it. I think it might actually be like some people paying $30 and some people paying $300 or $10,000 a gallon from what we're seeing.

Sasha Meinrath: When we looked at wholesale broadband pricing, what we found is markups as high as 10,000%. So yeah, at that point, you're talking about some people paying $300 a gallon for $3 gasoline. That's actually quite absurd. Anecdotally, what we've learned is because poor and more rural areas tend to have less updated infrastructure because of race and class and Internet connectivity or lack thereof, all correlate. We think there's a defacto redlining that's possible here as well. Which is to say, if you're not upgrading an area to a fiber infrastructure, for example, the differential between what you're paying for and actually receiving is probably greater.

Sasha Meinrath: And because this class and race correlate so highly in this country but you're likely to find is it for the same service level because of a variety of reasons, not the least of which is defacto redlining. We expect that these differentials will be far greater for certain constituencies and that, that will correlate or may correlate, I don't want to get ahead of the data here, with things like race, class, rural status, et cetera. And that I think has profound implications, not just for digital equity, but also for policy-making, regulatory authority, consumer protection law and a variety of different areas.

Christopher Mitchell: My prediction is that we will see that more among the telephone companies historically, and not as much on the cable companies because of the nature of upgrading cable plant. I think we'll see some differentials and there are places like in Seattle and Baltimore and then a few other places where there might be some homes here or there. But we're talking in excess of 75% of Americans have access to cable, most of those cable networks have been upgraded roughly at the same time to offer among the highest quality services that most people can get. And so, I'm expecting in cable to see more of an interesting issue around price and I'm expecting to see more differences in service among the telephone companies, particularly the larger ones.

8:07

Sasha Meinrath: That's right. But cable is also really odd because it's been so deregulated that the pricing is just all over the place. Like Comcast just raised my price for the eighth time in three years.

Christopher Mitchell: Wow. That's more than I've heard.

Sasha Meinrath: And they've raised it only by like a dollar and something cents and I'm like, "Why did it go from $79.95 to $80.85?" Like, "I don't know," but these kinds of little dinks to the price may or may not be differentially applied. What I do know and what you know, what your savvy listeners know is that if I call up Comcast and say, "Why did you raise my price? I want to leave Comcast now because of this extra dollar price." They will be like, "Oh. We'll knock $30 off your price-"

Christopher Mitchell: If there's a competitor in the area.

Sasha Meinrath: But it's a little tango that we have to do then every year. I'm like, "No, no, no. I want the better rate." And they magically just give it to you. My expectation is that these mechanisms whereby they're constantly trying to raise the price and certain constituencies are constantly beating down the price. That may not be evenly applied.

Christopher Mitchell: Yeah but I think it will have more to do with a competitive footprint than any kind of income but we'll see. This is the beauty of what Consumer Reports is doing.

Sasha Meinrath: It's savvy to hacking these kinds of systems. It's a sense of entitlement. Like, "I don't want to pay this money," like the grumpy bastard that calls up the ISP. But these are the tensions that we're hypothesizing may impact pricing. And the fact that this is not ludicrous hypotheses, these differentials exist. And yet officially the federal communications commission at all, refuse to even collect information, even though they're under statutory mandate to ensure the fair and equitable rollout of this and that affordable broadband is being deployed in a timely manner. The issue every year, a section 706 report, this big report that says like, "Yes or no." But the fact that they're not collecting the data to actually make an empirical analysis... It's crazy.

10:33

Christopher Mitchell: Well, Sasha, this is one of the things we wanted to talk about because I think a lot of people are under the impression that the FCC is about to collect that. In part, because the Congress has told the FCC that it is about to do that. If we have an FCC that is 2-2 right now, we don't have any idea who the fifth commissioner will be that will enable it to actually move forward on anything that does not upset the telephone and cable companies because in a 2-2 commission, what happens is they only do things that are non-controversial. So, right now my understanding is that as we're speaking and not even as the show's recording... I mean, as the show is recording, not even as it's being played back. If there was a nominee announced, it would be October, maybe November and possibly December until that person started their job.

Sasha Meinrath: Yeah and the wheels of confirmation are getting slower and slower, especially for democratic administrations, in ways that are creating substantial consumer harm.

Christopher Mitchell: Or subscriber harm. I wanted to say before we move on too far away from the Consumer Reports, data collection. It is www.broadbandtogether.org and there's only one page on www.muninetworks.org, where you don't get a notification that you should go do that right now. So, if you go at all to www.muninetworks.org, except for the front page where it just didn't work to throw it in, above the title of every single piece of content, there is a little blurb to push people to www.broadbandtogether.org. So, head over there, upload your bill, take seven minutes, do the survey and get all that stuff done.

Christopher Mitchell: Let's go back to the FCC. So, one of the things that the Biden administration has done via executive order is to say, "Hey, FCC, whenever you have those three votes, we want you to do the broadband consumer label." And last time you were on, we talked about this and I think that's good, right? It provides the agenda, right? The FCC is independent. They don't have to follow it but it's probably going to be a high priority now.

Sasha Meinrath: Yes. And my group was the one in 2009 that first proposed the broadband nutrition label and gave them a template.

Christopher Mitchell: I was so young then.

12:57

Sasha Meinrath: I know. We weren't so gristled and angry back then. So for me, this is year 12 of fighting these battles to say, "Hey, we really want people to be able to make informed decisions, apples to apples comparisons, between the offerings of different Internet service providers." Now, of course, that assumes you've got options, which is itself a whole issue.

Christopher Mitchell: Well, let's be clear. This is a crazy idea proposed by Marxists like Adam Smith, who thought that for markets to work, you should know how much something costs. It's not just about the person buying it, it's also about other businesses so they can figure out where to invest. Because if a business doesn't know how much Comcast is charging you, then they don't know if it makes sense to go after you as a customer. So, this is transparency just to make markets work in a way that capitalists want it to happen.

Sasha Meinrath: That's right. There's a fundamental assumption built into supply demand curves that there's perfect information amongst the players within a market. Which is to say, people know how much demand there is and people know how much supply there is and there's transparency around pricing and therefore, supply and demand curves even out at the optimal level.

Sasha Meinrath: Well, once you remove perfect information, once you create imperfect information, you can manipulate supply and demand curves to, in essence, engage in price gouging and lo and behold, in a realm like Internet service provision, where they've completely removed information around pricing, speeds and all the key elements you would need to make an informed decision. That at least correlates very highly with the fact that the United States pays amongst the highest prices amongst highly industrialized countries for broadband service.

Christopher Mitchell: Yeah but we've got caps and a lot of other places don't have those caps and we have great caps. Our caps are the best.

Sasha Meinrath: It is lunacy because this should be an area where Progressive's and free market tiers mostly agree because providing necessary information for informed decision-making is a common cause amongst these different constituencies.

Christopher Mitchell: Yeah. Big time and it's also more or less the law. That's the one thing that survived the Chairman Pai, removing a lot of the net neutrality titled stuff too, was that he preserved the transparency requirement. And yet when we're doing research, we can hardly often find what the upload speeds are. Although, I think that's mandated to be transparent.

15:41

Sasha Meinrath: Yeah. And mandates without teeth are just completely impotent and we are full of those. And likewise, I have actually read the executive order and what I find in there are the areas that are mandated. The White House is going to mandate a rulemaking on hearing aids being over the counter. And I'm like, "That's freaking fantastic. I'm really glad to see that. There's no reason why you should need a prescription for a hearing aid." And that is very different than a lot of what we see for exactly what you had pointed out, which is that the Federal Communications Commission, the Federal Trade Commission are these things called independent agencies, which means they don't fall under the direct purview of The White House.

Sasha Meinrath: So, when you read the executive order, what you see is that they use these words like, "We encourage the FCC to do X, Y, and Z. We encourage the Federal Trade Commission to do X, Y, and Z." But even in the places where they have purview, The White House really didn't come hard on a lot of these issues and didn't mandate. So, you see it in this executive order, the word, shall, which usually is a mandate. "You shall do this. You shall not pass." Right? But when you read the phrasing of the executive order, it's like, "You shall consider doing X, Y, and Z." And it's like, "Well, hold on. What does that mean?" It's like, "I'm mandating you to think about doing something about this problem that isn't going to get it done," and what that then points to is the need for really good personnel in key positions to move this forward. And as you mentioned, we don't know who the swing vote on the FCC is going to be at all. The Federal Trade Commission, the other big group around this issue-

Christopher Mitchell: Which now has Lina Khan at the helm, which is super exciting.

Sasha Meinrath: Yeah. So, right now it is a five person FTC, which means it can make decisions. Three Democrats, two Republicans but one of those key votes, Commissioner Chopra, has already been nominated to head the Consumer Financial Protection Bureau, CFPB, and as such, will be leaving. I am praying that he does not leave until his successor is actually confirmed. But what this really points to is whoever that fifth vote is, is going to be absolutely crucial because you could end up with somebody that's going to address these issues and vote with Lina Khan & Company and pass a bunch of really vital and absolutely overdue consumer protections or you could end up with somebody that's going to vote with the Republicans and stymie any meaningful reforms in that entire agency.

18:37

Sasha Meinrath: Well, thus far, what the Biden administration has done is not nominate that fifth vote in either the FCC or the FTC. And here we are, we are six months into an administration. The two key... Number one and number two, I'm not sure which one's more important. Agencies who intersect with this issue of broadband service provision are both understaffed in vital ways. That is shameful.

Christopher Mitchell: But we also have no one at NTIA, which is the Executive Agency or the... What's the word for it? Is it an agency? I'm trying to remember.

Sasha Meinrath: NTIA is under commerce and commerce under is the executive branch.

Christopher Mitchell: Right. What's the name for it?

Sasha Meinrath: It's an administration.

Christopher Mitchell: Okay. People will know that I just haven't been sleeping. And even though I can function for 10 or 15 minutes at a time, then I have these hiccups. But NTIA needs an administrator and they play important roles in broadband. They may play super important roles. They may soon be distributing more money for broadband than almost has been collectively spent today.

Sasha Meinrath: The funding is all over the place. The USDA has a bunch of funding.

Christopher Mitchell: Right. But I'm saying Congress... The rumors that I'm hearing is that Congress is considering which agency will distribute on the order of $40 billion. And yeah, that's a challenge.

Sasha Meinrath: It is. And what we see are all these agencies with different pieces of the pie and no comprehensive strategy across the government to actively deploy in the most efficacious manner all of these different programs.

Christopher Mitchell: I'm opposed to comprehensive strategies. I'm half serious. Sometimes I think it's just better to do a lot of different things. I'm from a place called the Institute for Local Self Reliance. When people say a patchwork, I'm like, "Yes, that's right. A patchwork. It sounds great. Patches are great."

Sasha Meinrath: But that's not what we do. All of these different agencies hone in on the same solution. Your existence as the go-to resource for municipal broadband documents that the government keeps doing the same tactic.

20:59

Christopher Mitchell: Right. Well, I think they did screw up the reverse auction in ways that are different from how they screwed up the Connect America Fund. So, we're seeing innovation and errors and bad decisions.

Sasha Meinrath: It is remarkable how incredibly creatively the government manages to fail and manages to consistently refuse to address successes. They're like, "We really want to do X." And you're like, "Hey, there's all these success stories doing X." And they're like, "Yeah, yeah. We want to do it. Not those ways."

Christopher Mitchell: Well, let me just say that one of the things that I sometimes hear from folks is that they get discouraged because there's really good people such as staffers. There's people working within the FCC. We're trying to get this stuff right. And we're not sitting here just trying to lob bombs. These are critiques and they are very good people who are learning lessons. And I think we'll be steering the ship in a better direction in the near future. So, I want to acknowledge that.

Sasha Meinrath: Yes and I wouldn't be doing this work year in and year out.

Christopher Mitchell: Amen.

Sasha Meinrath: I wasn't an optimist about, although we will eventually win these battles. On the other hand, it always pains me when I see billions of dollars flushed down the toilet into not very innovative programs and not very effective tactics. Many of which are making the problems harder to address, like for example, Connect America Fund and pretending like satellite connectivity is functionally equivalent to a wire line connection. And then therefore, making areas that have been covered with satellite ineligible for funding to bridge the digital divide. That is bad policy that exacerbates problems and was an unnecessary fumble. And I worry that we're going to see a lot more of this but what I mean by a comprehensive plan is not one solution or silver bullet to fix all this. What I'm talking about is there needs to be a national broadband map where I can click on any house and know how we're going to get connectivity to that. Whether it's Comcast and AT&T and Municipal Network, a satellite up-link... I need to be at a C at a national scale, how we're solving the problem for everyone.

23:20

Christopher Mitchell: And because this is one of the issues that the FCC is working on and we talked about this with John Chambers. Having that data be open and open for critique. And so, it's not a matter of being like BlackBox. You can't know how much it's going to cost or what the modeling is but actually having it all open for critique and publication.

Sasha Meinrath: That's right. Yeah. The radical position that I hold when it comes to a lot of this is, use science, right? So, I meet with White House officials. I brief them and they're like, "So, what's your solution?" And I'm like, "Use the scientific method. Have scientists provide your research and analysis on this issue. Turn it over to network researchers to identify what the state of the network is. Talk to the people that built the Internet about limitations, shortcomings, problems that have arisen with the Internet." The notion that science has become and being pro-science has become the radical position, just shows you how this whole realm has been regulatory captured in ways where, I'll talk to the FCC and be like, "Hey, let's use the best practices from the network research community for our national broadband map." And they're like, "Well, we could do that or we could go with this completely unproven proprietary solution that nobody can peer review and costs 10,000 times more."

Christopher Mitchell: But it's provided by a company that can navigate the procurement process, right? This goes back to... I remember working for a state agency and suggesting that they were using a stats package that was not only inferior to one that you could use a pearl script, that was just a Pearl script that AW stats at the time, that could run. And they looked at me blankly, and this was a good person, but they were just like, "Look, we point and click. We're not hiring people that do that stuff. We need a vendor that is there." And this is something that Travis Carter says on. I think he said it on the Connect This show. Connect This. Great show. Y'all should watch it. And he talks about how he's talked to cities where he's building fiber networks and he's like, "You all should just run your own fiber network to connect to your buildings. You'd save a lot of money to have higher performance." And they're like, "But who would we call if it broke?" And he's like, "You would know how to fix it. You would have an employee that would be understanding of that."

Christopher Mitchell: These things don't just break. It's not like the transmission on an 86' Plymouth Voyager van, which my family had for 20 years and went through three transmissions. This is a system in which often, you get warnings ahead of time. There's planning. It's just not that hard. You and I run our own networks in our homes and this is more complicated but it is not building a satellite in low earth orbit complicated and local governments can handle it.

26:17

Sasha Meinrath: That's right. And in fact, this is an area where having built community networks for over 20 years now, I can tell you that there's a whole mythos being propagated by the ISPs that this is really complicated and you've got to leave it to the experts and blah blah. And the reality is, as difficult as things were 20 years ago, they are infinitely easier today and it's really easy to build this infrastructure. You can train people in a matter of days to weeks to deploy wide area and at least small metro scale networks. And it's not rocket science.

Christopher Mitchell: 4,000 cities built their own electric grids. Maybe 4,500. And I'll often remind people because I think there's this sense of, "Oh, electricity is easy." And you mess up electricity and it kills you. It kills other people. It's serious. This is broadband and it's serious but it's not like you touch the wrong thing and you die serious. So, like that's nice.

Sasha Meinrath: And in terms of complexity, building a network is easy. Raising kids is difficult.

Christopher Mitchell: Amen.

Sasha Meinrath: Building a network is something anyone can learn pretty quickly. And as you mentioned, we build systems in our homes today that are more complicated than most office systems of a generation ago. And we don't think anything of it. And so, encouraging people to become informed and especially doing the econometric analysis to show to a community like, "Look, if you spend the time and energy becoming savvy, getting the skills, training your staff and bringing that all in house, your burn rate over the next decade or two decades is so much lower than the holding to an outside provider. Your service levels are better. Your operating expenses are lower. Your residents, consumers, subscribers, whatever you wish to call them, are just happier. They get a better service for a cheaper price." And the fact that we look at this, we can agree on these numbers and yet simply refuse to acknowledge that reality is a remarkable psychotic kind of phenomenon.

28:35

Christopher Mitchell: Well, I want to note that the part that I would say is more or less approaching trivial is building an enterprise network for local government to connect 20 to 200 sites. I will say, if you're going to build out to the city, take it seriously. Do your homework, hire the right people. In no way do I ever... and I know you don't either but we just want to be very clear. This is doable but you need people to take it seriously. And one of the things that I find frustrating is a lack of people in the United States of America that take their work seriously, which is what every generation says about the people that come after you.

Sasha Meinrath: You're turning into an old grandpa.

Christopher Mitchell: You can tell. I've got the white beard. I'm working on it.

Sasha Meinrath: No, but it is true. And one of the great conundrums that's going to now face this country as we drop tens of billions of dollars in this space, is a whole bunch of wholly unqualified, snake oil salesmen and consultancies that are going to pop out of the woodwork, selling every which solution you can possibly imagine. And it's going to cause a lot of communities that don't themselves do their own due diligence and homework to have a whole world of pain. And I say this because we saw this previously in the muni-wireless realm.

Sasha Meinrath: Remember WiMAX?

Christopher Mitchell: Oh yeah.

Sasha Meinrath: I remember WiMAX. And we're going to see it with 5G as well, which is that this thing is being sold as a solution to any problem you can possibly imagine but it's actually inferior to older school networks for a variety of use cases. And that's due to propagation characteristics of frequency. So, people are like, "No, no, no. It's not." But I'm like, "No, no, no. Physics, man. Your frequency is higher. It's not going to go through as much foliage than a two or a 3G network." And no amount of PR is going to change the fundamentals of universal physics.

Christopher Mitchell: You can raise the volume. You can't raise the power. Be on a certain point.

Sasha Meinrath: So, there's a lot of this stuff that's going to happen very quickly. And so, it's even more important for people to do their own due diligence. Find folks that are trusted, that know their stuff because when there's money, there are sharks in the water and this is like a chum fest. I would say relatively unethical individuals to try to get a bite at this massive subsidy.

31:05

Christopher Mitchell: We're going to have to wrap it up. I got to go work on my snake breeding program. I'm going to be the Levi's guy for the snake oil salesman. So, maybe I don't understand that analogy perfectly.

Christopher Mitchell: It's great to see you, Sasha.

Sasha Meinrath: Absolutely. My pleasure.

Ry Marcattilio-McCracken: We have transcripts for this and other podcasts available at www.muninetworks.org/broadbandbits. Email us at podcast@muninetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is @CommunityNets. Follow muninetworks.org stories on Twitter. The handle is @MuniNetworks. Subscribe to this and other podcasts from ILSR, including Building Local Power, Local Energy Rules and the Composting for Community podcast. You can access them anywhere you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter at www.ilsr.org. While you're there, please take a moment to donate. Your support, in any amount, keeps us going. Thank you to Arne Huseby, for the song, Warm Duck Shuffle licensed through Creative Commons. This was a Community Broadband Bits podcast. Thanks for listening.