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Wheeler Tells Cable Industry He Intends to Remove Anti-Competitive State Laws
FCC Chairman Tom Wheeler is prepared to roll back restrictions that prevent local governments from deciding if a municipal network would be a wise investment. At the Cable Show Industry conference in Los Angeles, Wheeler told cable industry leaders the FCC will wield its powers to reduce state barriers on municipal networks.
Wheeler spoke before the National Cable & Telecommunications Association (NCTA) on April 30. These words perked up our ears and those of community networks advocates across the U.S. From a transcript of Wheeler's speech:
"One place where it may be possible is municipally owned or authorized broadband systems. I understand that the experience with community broadband is mixed, that there have been both successes and failures. But if municipal governments—the same ones that granted cable franchises—want to pursue it, they shouldn’t be inhibited by state laws. I have said before, that I believe the FCC has the power – and I intend to exercise that power – to preempt state laws that ban competition from community broadband."
As our readers remember, a January DC Circuit Court of Appeals decision opened the path for the FCC to take the action Wheeler proposes. Since then, communities have expressed their desire for local authority with resolutions and letters of support. Communities in Michigan and Louisiana, Georgia and Idaho, Illinois, Maryland and Kansas, have shared their resolutions with us. A number of other communities have issued letters of support encouraging action under section 706.
Michael Powell said What?? Why Everyone Should Ignore the Cable Lobby
It is the Internet’s essential nature that fuels a very heated policy debate that the network cannot be left in private hands and should instead be regulated as a public utility, following the example of the interstate highway system, the electric grid and drinking water. The intuitive appeal of this argument is understandable, but the potholes visible through your windshield, the shiver you feel in a cold house after a snowstorm knocks out the power, and the water main breaks along your commute should restrain one from embracing the illusory virtues of public utility regulation.Pause for a second and think of the last time your water rate went up. Think of what you were paying 10 years ago for water and what you pay now. Compare that to anything you get from a cable company. His point seems to be that because more regulated utilities like water and electricity are not PERFECT, regulation has failed and we should just let the private sector handle that. Well, some communities have privatized their water systems and the results have been disastrous - see a company called American Water in David Cay Johnston's book The Fine Print and also explored here. Let's imagine if electricity was not tightly regulated and the market set the rates. How much would you pay for illumination at night? A refrigerator? Probably 10 times what you do now if that was your only option. Maybe 100 times after a few Minnesota winter nights. Market-based pricing for electricity would at least encourage conservation and efficiency, I'll give it that. Public utility regulation is far from perfect but the alternative is far scarier. There is no "market" for these services over the long term. There is monopoly.
Cable Industry Dumps Dark Money into DC
Industry Lobbyists Oppose Gigabit Communities Race to the Top Proposal - Part 2
This is Part 2 in a two-part series discussing comments submitted to the FCC in response to a petition filed by Fiber-To-The-Home Council proposing a new Gigabit Community Race to the Top program.
In Part 1 of this post, I focused mainly on the complaints filed by the National Cable & Telecommunications Association (NCTA) against FTTHC’s Race to the Top proposal. While there was nothing new in those arguments (we see them all the time from industry spokespeople), I wanted to highlight their errors in light of this promising proposal to promote community networks. This post will focus on some of the more technical arguments which further demonstrate the industry’s false assertions.
NCTA attacks the FCC’s authority to implement Race to the Top, claiming that neither Section 254 (addressing universal service) nor Section 706 (addressing “advanced telecommunications capability”) of the Telecom Act authorize such a program.
The cable lobby’s argument against Section 254 authority hinges on the statute’s requirement that universal service funds only support services in small and rural markets that are “reasonably comparable” to those available in the rest of the country. Therefore, NCTA argues, Race to the Top would “enable a small number of communities to receive faster broadband speeds than the vast majority of Americans in urban areas have chosen to purchase.”
NCTA essentially believes its members get to dictate American broadband policy. If the majority of Americans “choose to purchase” only single-digit Mbps (megabits-per-second) broadband because that’s the only affordable option in their area, then the FCC cannot subsidize faster networks, anywhere. Or so argues the NCTA.
Even more tortured is the NCTA’s argument against the FCC’s Section 706 authority to implement Race to the Top. Section 706 instructs the FCC to regularly assess the deployment of “advanced telecommunications services,” and when it finds that such services are not rolling out fast enough, the FCC must make efforts to accelerate deployment.
Surprise! Industry Lobbyists Oppose Gigabit Community Race to the Top Proposal - Part 1
This is Part 1 in a two-part series discussing comments submitted to the FCC in response to a petition filed by Fiber-To-The-Home Council proposing a new Gigabit Community Race to the Top program.
The Fiber-To-The-Home Council (FTTHC) recently submitted a proposal to the FCC to create a Gigabit Communities "Race to the Top" program. The proposal suggests granting unclaimed portions of universal service funds (USF) to qualifying entities in small and rural markets willing to build gigabit networks. While the proposal may need some adjustments, the idea holds potential for encouraging community owned networks and we hope the FCC takes the next step by opening an official rulemaking proceeding.
What makes this proposal so promising for community networks is that it may not require grantees to qualify as “eligible telecommunications carriers” (ETCs), a technical requirement placed by the FCC on USF recipients. This requirement virtually assures that USF funds go to already established telcos and not to upstart community networks.
Instead, Race to the Top lays out its own qualifying criteria which opens the door for a broader variety of recipients, including co-ops, nonprofits and municipalities, taking a similar approach as the federal stimulus BTOP program. Furthermore, Race to the Top has the potential to improve on BTOP in one major aspect by focusing on last-mile networks, which BTOP grants largely shied away from.
The FCC comment period for this initial proposal has closed and the majority of submitted comments are supportive. But I want to highlight some of the misleading comments submitted by a few industry lobby groups - National Cable & Telecommunications Association (NCTA), Rural Broadband Association (NTCA) and USTelecom. This post will focus on the NCTA, the main lobbying apparatus of the massive cable corporations. A future post, Part 2, will discuss the others.
US Broadband Policy: Competition for Some!
As with the broadband stimulus funds being handed out by the Commerce Department, NCTA is concerned that the USF money not go to overbuild its members. "It would be a poor use of scarce government resources to subsidize a broadband competitor in communities--including many small, rural communities -where cable operators have invested risk capital to deploy broadband services," McSlarrow says.This seems like a common sense argument. Why would we want to subsidize broadband for those who already have a single option (underserved) when others have no choice at all (unserved)? Unfortunately, building networks to solve the problem of the unserved is all but impossible without simultaneously serving some who are underserved. This is because the unserved are often in areas so remote and expensive to serve, there is no sustainable business model to serve only them. So the idea that we could somehow only target the unserved with networks is extremely suspect. Unless we want to endlessly subsidize networks in these areas (which companies like Qwest emphatically want because they would likely collect those subsides endlessly), we need to encourage sustainable networks that reach across those already served, underserved, and unserved.
He added that it also might discourage the incumbent from continuing to risk that capital. "Government subsidies for one competitor in markets already served by broadband also might discourage the existing provider from making continued investments in its network facilities.I certainly respect this argument up to a point. But when it comes to essential infrastructure, we know that most existing providers (particularly absentee-owned massive companies) are delaying investments in network facilities anyway because the lack of true competition allows them to delay making the investments more common in our international peers (where true competition exists, often as a result of smarter government policies than we can muster here).