Thursday, July 30, 2009

California local governments, nonprofits eligible for 90% broadband stimulus subsidization

California local governments and nonprofit entities that can successfully navigate the complex, 121-page set of rules governing the first round of grants providing up to 80 percent subsidization of broadband infrastructure build outs under the National Telecommunications and Information Administration's Broadband Technology Opportunities Program -- and do so in the just two weeks remaining before the Aug. 14 application deadline -- could get as much as 90 percent of their project costs subsidized.

To leverage the federal broadband stimulus funds, the California Public Utilities Commission had previously approved an order expanding its subsidy program for broadband infrastructure, the California Advanced Services Fund, to provide up to half of the 20 percent match required of regulated telecom providers proposing BTOP projects.

Expanding the CASF funding to include local governments, telecom cooperatives and other non commercial providers required legislative authorization. Gov. Arnold Schwarzenegger signed the legislation, AB 1555, into law July 29. An urgency measure, the bill takes effect immediately.

It remains to be seen if any such projects will be proposed given BTOP rules that make it difficult to qualify projects and give incumbent providers effective veto power, particularly in areas deemed "underserved" under the guidelines.

Jump in online video calls for higher FCC minimum broadband definition

PC Magazine reports this week on a survey by the Pew Internet & American Life Project that found the percentage of adults who watch video online has nearly doubled since 2006, up to 62 percent versus 33 percent in December 2006.

The item underscores the inadequacy of the current minimum definition of broadband of at leasat 768 Kbs download standard adopted by the U.S. Federal Communications Commission, which has also been written into the rules governing the disbursement of $7.2 billion in federal economic stimulus funds for broadband infrastructure. That speed isn't going to hack it for video, which most observers agree is the fastest growing form of online content.

The 768 Kbs standard also represents a huge step down from the speeds Congress contemplated in a January draft version of the American Recovery and Reinvestment Act as minimally defining wireline broadband of at least 5 Mbs download and 1 Mbs uploads and 45 Mbs on the downside and 20 Mbs up for "advanced" wireline broadband.

Under the stimulus legislation, the FCC is required to develop a national broadband plan and present it to Congress next February. The agency should dispose of its outdated definition of broadband and instead adopt the minimum standards outlined in the draft stimulus legislation as they are better matched to meet the growing bandwidth requirements of online video.

Wednesday, July 29, 2009

U.S. broadband stimulus rules favor telco/cable duopoly, turn back clock to 1998

Take a look at Christopher Mitchell's critique of the Notice of Funds Availability (NOFA) issued at the beginning of the month by the National Telecommunications and Information Administration (NTIA) for the first round of grants and loans to subsidize broadband infrastructure allocated in the American Recovery and Reinvestment Act (ARRA).

Mitchell's complaint is rather than getting the United States on a path toward upgrading its obsolete copper-based telecommunications infrastructure to modern fiber optic-based networks owned by local governments and community-based organizations, the rules instead instead favor incumbent private sector providers and effectively revert to the status quo of a decade ago. That's directly at odds with the intent and language of the ARRA, Mitchell asserts, suggesting the rules will require additional future government subsidies since they encourage construction of on the cheap, technologically obsolete telecom infrastructure in a race to the bottom rather than the top.

Here's an excerpt from Mitchell's How the NTIA Dismantled the Public Interest Provisions of the Broadband Stimulus Package:

NTIA has charted a path to bring the slowest networks to people who live in areas that are the most uneconomical to reach. Rather than doing it right the first time (i.e. a strategy that starts with modern speeds and identifies an upgrade path moving forward), NTIA’s path will likely expand 1998-era networks, certainly requiring future appropriations to bring residents to networks with contemporary speeds.

Tuesday, July 28, 2009

Mixed messages inside a broadband black hole


Life can be odd inside a broadband black hole where the normal laws of logic and common sense get twisted and break down.

Consider, for example, today's mail delivery. It contained the contradictory mix of 1) A letter soliciting Comcast Business Class service, a $79/month bundle of "business class Internet up to 4 times faster than DSL." (Query: how can it be compared to a nonexistent service -- no DSL here) and 2) A big postcard from HughesNet addressed to "DIAL UP INTERNET HOUSEHOLD" inviting me to suck a satellite to get speeds "50X FASTER than dialup." (Thanks but I'll pass).

Two direct mail solicitations: One from a provider that can't deliver what it pitches (Comcast) and another selling a costly, latency larded service (HughesNet) that could be more aptly dubbed MolassesNet.

Somehow these companies don't have their marketing campaigns straight. It's no wonder the government wants to map broadband availability because apparently the providers themselves are confused.

After 13 months, persistent Firefox/My Yahoo! bug finally squashed

After nearly 13 months -- longer than the lifespan of most biological insects -- a persistent bug in the interaction of the Firefox browser and the My Yahoo! home page has finally been squashed. This blog first wrote about the issue last September, which surfaced when Yahoo did a forced upgrade to a new home page.

The problem: when Firefox users clicked on an article on the home back and then attempted to navigate back to their My Yahoo! home page, they would lose their place on the home page which would reset to the top of the page. They then had to scroll down the page to find where they left off, making for a very kludgy browsing experience.

With the recent release of the latest version of the browser, Firefox 3.5, the problem appears to have been finally resolved.

Monday, July 27, 2009

U.S. residential DSL access shows no gain since 2006


U.S. residential DSL availability in the first half of 2008 continued to show no increase since it virtually hit the wall in 2006, with about a fifth of the nation still unable to access it.

That's pretty much the same story reported on this blog back in January based on Federal Communications Commission data covering the previous six-month period of July to December 2007. Readers can see for themselves by looking at the first column of Table 14 in the latest FCC report on Internet access released last week.

The same states continue to rank low on residential DSL access, including Vermont, Virginia, New Hampshire, Maine Michigan, Mississippi, Maryland and New York. The FCC withheld DSL availability for some states including Delaware, Massachusetts, Rhode Island, and Hawaii citing "firm confidentiality."

This redaction and other mechanisms to obfuscate where broadband infrastructure deployment exists and where it doesn't are increasingly cropping up at a time when government initiatives to increase broadband access demand greater transparency. It will be interesting to see how federal and state governments resolve this fundamental conflict.

Tuesday, July 21, 2009

Memo to RUS and NTIA: Proposed revisions for broadband stimulus funding rules

The two agencies administering rules governing the disbursement of $7.2 billion of grants and loans for allocated for broadband infrastructure construction in the American Recovery and Reinvestment Act -- the Rural Utilities Service and the National Telecommunications and Information Administration -- should revise the guidelines as follows:

1. Liberalize the rules to encourage consumer telecom cooperatives, recession ravaged local governments and small local fiber providers to propose projects. While the guidelines for the first round of applications issued July 1 allow up to five percent of application preparation costs (e.g. infrastructure engineering, development of minimum 5-year business plan) to be awarded in grants and/or loans, only projects accepted for funding can get these substantial costs credited back. This creates sizable up front risk and funding hurdles that discourage infrastructure builds by non-incumbent entities and providers. Revise the guidelines to include loan guarantees for engineering and business planning for projects that demonstrate good faith, diligent planning work. Doing so will encourage more projects and also help weed out those that seem like a good idea but won't pencil out.

2. Don't require non incumbent providers to be census takers and go door or door to document the level of broadband availability and adoption in census blocks comprising their proposed projects. That's a job for the Census Bureau and introduces cost and delay that are contrary to the stimulus funding goal of rapid deployment of broadband infrastructure.

3. Lose the broadband black hole preservation provision in the current rules that allows incumbent providers to challenge proposed projects. Also trash a provision in the definition of "underserved" areas deeming these areas as such if no wireless provider merely advertises service with at least 3MBs download connectivity. Both of these provisions will only introduce delay and may lead to litigation that's at cross purposes with the speedy build out of broadband infrastructure.

Minnesota municipalities don't like broadband stimulus rules

The Minneapolis StarTribune.com reports Minnesota municipalities are having second thoughts about applying for some of the $7.2 billion in taxpayer subsidized grants and loans allocated in the federal economic stimulus package for broadband infrastructure construction.

The reason is the 121 pages of guidelines issued July 1 by the two federal agencies that will review and determine which projects get funded require applicants to conduct door to door censuses of their proposed project areas to determine if the census blocks contained in their contemplated project areas qualify for funding under the rules' definitions of what constitutes an unserved or underserved census block. Skipping this step could jeopardize a project since it could be rejected outright by the agencies for lack of required documentation of need or challenged by incumbent providers as permitted under the guidelines.

An excerpt from the article:

The problem, as city and county broadband planners see it, has less to do with technology than with the sheer legwork required to create an acceptable proposal.

Applicants must prove that all the areas they propose to serve would meet a narrow federal definition of being underserved -- that 50 percent or more households in the area lack broadband access, or that fewer than 40 percent of the households already subscribe to broadband. That puts the burden on cities and counties to undertake expensive and time-consuming door-to-door surveys, because telephone and cable companies don't reveal which areas they serve.

The Minnesota munis' concerns are understandable. They don't see themselves as being in the census business. Conducting a door to door survey is a costly and time consuming task that means many prospective applicants have concluded there's no way they can submit project applications to the agencies by the Aug. 14 deadline for the first round of funding.

FCC broadband czar underwhelmed by public comments on U.S. broadband policy

MultiChannel News reports the Federal Communications Commission's broadband czar Blair Levin is underwhelmed by the quality of comments the agency has received in response to its call for public input for a national broadband policy. Congress set a February 2010 deadline for the policy as part of the American Recovery and Reinvestment Act enacted earlier this year.

The gist of Levin's complaint is the comments are overly self serving and don't help the FCC shape a broadband policy that will further the Obama administration's goal of making broadband accessible to all American homes and businesses.

That's hardly surprising given the inherent tension between the public's growing and nearly insatiable demand for more and faster broadband and the private telco/cable industry's duopolistic control over who gets service and at what speed and price -- and only provides it when it's in their and not necessarily in their customers' interest.

Implicit in this tension is the evolution of the U.S. telecommunications infrastructure and services away from the closed, proprietary single purpose systems of the past that provided basic phone service and cable. The future is locally owned and operated open access-based fiber infrastructure to the premises that can deliver various advanced Internet-protocol-based services to business, government and residential consumers with bandwidth to spare. In that regard, Levin's FCC is likely getting variations on the theme "fight the future" from a telco/cable duopoly that fears it.

Wednesday, July 15, 2009

App Rising: Ten ways broadband stimulus rules fail America

From App-Rising's perspective, the Notice of Funds Availability (NOFA) announced July 1 for the first round of $7.2 billion of grants and loan subsidies for U.S. broadband telecommunications infrastructure falls short of the goal of Obama administration and Congress in authorizing the funds as part of the American Recovery and Reinvestment Act. Some key excerpts:


In large part this stimulus is business as usual for America's broadband policy, or lack thereof. We're continuing to muck around, shuffling our feet when the rest of the world is racing forward. It's not just that this NOFA isn't aspirational enough, it's that it does seem to be aspiring to anything at all. There's no ultimate goal for what it's setting out to achieve other than getting some people some broadband. And there's seemingly little being done to even use this as a learning experience that we can build from and help guide future investments. It feels like NTIA and RUS just took the safest route, followed the same steps that have failed us in the past, and at best only marginally improved the approach. Because of this I can't help but feel pessimistic about what the ultimate impact of the broadband stimulus will be.

There are a host of truly shovel-ready, truly innovative, true testbed showcase projects for us to be supporting through this broadband stimulus. But based on how things are looking so far, I can't help but feel like this NOFA is already a massive failure and the money hasn't even gone out the door yet.

I agree the rules governing this first NOFA issued two weeks ago create too much opportunity for incumbent providers to delay proposed projects in order to maintain their territorial hegemony that is a hallmark of America's privately built and operated telecommunications infrastructure.

On the other hand, App-Rising sees this first NOFA as all encompassing broadband policy. It is not. The broadband provisions of the economic stimulus legislation call for the creation of an omnibus U.S. broadband policy by Febuary 2010. Plus the funding allocation was described by Obama administration officials as a "down payment" on a badly needed upgrade of the nation's telecommunications infrastructure. Finally, there's a good chance the rules of the first NOFA will be revised based on complaints such as these in the second and third rounds of funding later this year and early 2010.

Tuesday, July 14, 2009

California PUC approves subsidy for fixed WISP build offering 14Mbs symmetric service

The California Public Utilities Commission announced July 9 that it approved a 40 percent subsidy totaling $2.8 million from its California Advanced Services Fund for fixed terrestrial wireless infrastructure to provide broadband connectivity to more than 14,000 unserved premises in Alpine, Amador, Calaveras, Tuolumne, and Mariposa counties.

According to the CPUC resolution approving the project, it will be built over a 20-month period by Mother Lode Broadband and will leverage a regional network of existing mobile cellular towers reinforced with "expanded backhaul" -- most likely fiber.

The proposed throughput will blow existing WISPs -- both mobile 3G cellular as well as fixed premises providers -- clean out of the water. It's on a business class scale providing symmetric connectivity of "up to" 14 Mbs. There's no word on latency and Mother Lode Broadband is mum on what protocol -- WiMAX is a likely possibility -- that it plans to use. In addition, the CPUC resolution is silent on the technology that will make service this scale possible, only revealing it will employ "high capacity licensed spectrum."

Only time will tell if this is for real or simply more wireless vaporware. With the deployment planned over 20 months, there is a relatively large amount of that -- and probably too much for those 14,000 premises that needed broadband 10 years ago and are still stuck on dialup or sucking a satellite. "I'll believe the speeds when I see them," one skeptical Northern California industry insider tells me.

Fed up with "depressing" service, Virginia county forms broadband authority

BEDFORD — After several months of consideration, the Bedford County Board of Supervisors narrowly voted Monday to form a broadband authority.

The authority, which was enacted by a 4-3 vote after a public hearing, is a legal entity that can contract directly with private providers to deliver broadband access to residents and businesses. The seven-member board would serve as the authority and could appoint an advisory committee for technical assistance.

“We do envision this as a public-private partnership,” Assistant County Administrator Frank Rogers said of the authority’s purpose. He said the county “is not looking into the business of being a broadband provider” but rather a vehicle to help facilitate service to parts of the county that are not served or underserved.

Monday, July 13, 2009

California issues updated "unclassified" state broadband availability maps

The California Public Utilities Commission has published updated versions of maps of broadband availability in the Golden State that were issued in early 2008 by Gov. Arnold Schwarzenegger's California Broadband Task Force.

There are two versions of the maps: "classified" versions accessible only to approved providers and "unclassified" maps that are publicly available and published online as .pdf files. The secret maps -- classified at the insistence of incumbent providers who don't want the public or potential competitors knowing exactly what they are providing (and more importantly, not providing) and where -- purportedly reveal street address level broadband availability organized by census block. The unclassified public maps by comparison show only the view from 60,000 feet and are sanitized via rasterization and the omission of key highway and road identifiers and town markers. This renders them nearly inscrutable to outsiders and consumers -- some of whom complain the maps exaggerate the boundaries of where broadband availabilty truly exists.

Notably, the two federal agencies administering the distribution of $7.2 billion of grant and loan subsidies to faciltiate the build out of broadband telecommunications infrastrucutre -- the Dept. of Agriculture's Rural Utilities Service (RUS) and the Commerce Department's National Telecommunications and Information Administration (NTIA) -- issued rules last week for the first round of funding requiring proposed projects include service area maps delineated by census block and posted on the federal government's Broadband Stimulus Portal.

When compared with the California maps, these newly created maps of proposed project areas may show where the broadband black holes really exist in a way the California maps do not.

Sunday, July 12, 2009

Ironically, some broadband stimulus projects may need stimulation of their own

Grants and loan subsidies totalling $7.2 billion in the Obama administration's economic stimulus package are aimed at "shovel ready" broadband telecommunications infrastructure projects that can generate employment and do so quickly while expanding access to broadband .

Project plans that have already been drawn up and have been sitting on the shelf and not proceeding but for sufficient capitalization will likely be the only ones that will be able to meet the fast approaching Aug. 14 deadline for the first round of funding under rules developed by the two federal bodies administering the funds, the Dept. of Agriculture's Rural Utilities Service (RUS) and the Commerce Department's National Telecommunications and Information Administration (NTIA).

However to qualify for subsequent rounds of funding, start up projects -- particularly those proposed by nonprofits and telecommunications cooperatives -- ironically face significant financial hurdles just to get their stimulus funded project proposals ready. That's because the funding application guidelines jointly issued by the RUS and the NTIA and published last week in the Federal Register require extensive preparation including the foundational step of identifying contiguous census blocks that fall within the guidelines' definition of "unserved" and "underserved" when it comes to broadband access. And that doesn't include the actual project network plan that in the case of a project that will cost more than $1 million or more to build requires retaining professional engineering consultants to review and sign off on the build.

Both of these pre-build steps can run anywhere from $30,000 to $100,000 and potentially far more depending upon the size and scope of the proposed project. While the rules allow these application preparation costs to be reimbursed should a proposed project be approved for funding, raising these sums on the front end with no guarantee of reimbursement given both the complexity of the rules as well as likely challenges of proposed projects by incumbent providers as specifically provided under the guidelines could prove to be an insurmountable hurdle for projects by telecom coops and cash-strapped local governments. That will lead to far fewer potentially meritorious projects being proposed than might otherwise be the case. For the next two rounds of broadband stimulus funding this fall and next year, the RUS and the NTIA should liberalize the rules to include at least some of these costs for broadband build out projects proposed by nonprofits and local governments.

Friday, July 10, 2009

California PUC adopts order aimed at leveraging federal broadband infrastructure grants

The California Public Utilities Commission announced July 9 it has adopted a proposed order designed to leverage and maximize California's share of $7.2 billion set aside for broadband infrastructure construction in unserved and underserved areas of the nation in the American Recovery and Reinvestment Act (ARRA).

The decision pertains to grants of up to 80 percent for such projects administered under the $4.7 billion National Telecommunications and Information Administration's Broadband Technology Opportunities Program (BTOP). It would cover half of the minimum 20 percent BTOP match required of those proposing broadband infrastructure projects, bringing the potential total combined federal/state subsidy level up to 90 percent for approved California BTOP projects.

The CPUC supplemental BTOP funding would be allocated out of the regulatory agency's California Advanced Services Fund (CASF). Created in 2007, the $100 million CASF is funded by a surcharge on intrastate long distance calls, of which about $80 million remains unspent.

Projects that qualify for the supplemental grant match will have to meet a higher minimum thoughput standard than under the BTOP. While the federal standard is just 768 Kbs for downloads and 200 Kbs for uploads, under CASF rules the minimum is 3 Mbs down and 1 Mbs for uploads.

While the current CASF rules restrict funding to wireline and wireless providers that have been certified by the CPUC, the decision contemplates making the CASF funding available to entities that aren't providers such as local governments and nonprofits. That would require legislative authorization under an urgency bill currently pending in the state Senate, AB 1555.

Lawmakers should approve this measure and sent it to Gov. Arnold Schwarzenegger. California cannot rely exclusively on providers to close the digital divide and build out badly needed broadband infrastructure; local goverments and telecommunications cooperatives need to be part of the solution.

Tuesday, July 07, 2009

Video conferencing vaporware

The San Jose Mercury News reports Cisco Systems is collaborating with phone and cable carriers on products and services that would allow people to video conference using their televisions. Built on Cisco's TelePresence corporate-video conferencing system, the consumer version will debut within 12 months, the newspaper reported today.

Um, I don't think so. Short of a crash program to wire up homes throughout the United States with fiber optic connections over the next year, this is pure vaporware. Given the pathetic state of last mile Internet connectivity that can barely support low quality YouTube video, the key question is got bandwidth? The answer: nope and not likely except for that small slice of the nation that has fiber to the premises.

In many respects, we're not much closer to ubiquitous videoconferencing than we were nearly 50 years ago when Ma Bell demonstrated the first videophone at the 1960 World's Fair.

Monday, July 06, 2009

U.S. broadband stimulus funding rules for "underserved" areas could produce controversy, delay

While designed to stimulate employment and do so quickly, the federal economic stimulus package enacted in February and specifically the $7.2 billion it allocated as a down payment on a badly needed upgrade of America's aged telecommunications infrastructure may not work as rapidly as intended. With unemployment persisting and exceeding that forecast by the Obama administration as it took office just before the enactment of the stimulus package, this could prove problematic.

The $7.2 billion allocation is targeted for build out of telecom infrastructure in those areas of the nation that are "unserved" and "underserved" when it comes to broadband access. Under the rules governing the award of grants and loans issued last week by the two federal agencies overseeing them, generally only deep rural America where dialup and satellite are the sole options for Internet connectivity will likely meet the definition of unserved. Proposed broadband projects to serve these areas are unlikely to generate much controversy.

However much of the U.S. is chock a block with broadband black holes located in metro areas outside of rural areas due to incomplete buildout of the existing telco and cable company wireline infrastructure and the well known technological shortcomings of DSL over copper. Most of these census blocks will fall into the underserved category. The definition of what constitutes underserved is complex and likely to lead to controversy, delay and potential litigation that could frustrate the key goal of the stimulus funding: to rapidly preserve and generate jobs.

Since the rules require maps of the contiguous census blocks of proposed broadband projects to be posted at a Web site run by the two agenices administering the stimulus funds and stipulate that only one project can be approved for a given area, it's possible -- if not probable -- that existing providers will challenge some of the proposed projects as not in compliance with the definition of underserved. They could contend that they serve at least half of a given census block with wireline broadband, thereby eliminating a key element of the definition of an underserved census block. Under the guidelines, such a challenge would quickly put a proposed project on hold or ultimately result in its rejection by the agencies.

The incumbent wireline providers -- typically deep pocketed telcos and cable providers -- could tie up these proposed projects both in challenges before the agencies and in court if necessary. Incumbent wireline providers tend to view their service areas as franchises and even sovereign territory regardless of whether (or not as is often the case) they are actually providing services throughout them.

Wireless providers could also stymie proposed projects in underserved areas, but for them it could be harder. Under the rules, a census block is considered underserved if no wireless broadband provider advertises service providing at least 3 Mbs download. That eliminates 3G cellular based wireless as well as many fixed terrestrial Wireless Internet Service Providers (WISPs) since in underserved areas they typically offer download speeds below 3 Mbs. That's because both prefer relatively lower cost T-1 lines for backhaul that can't provide 3 Mbs download speeds in order to enhance their profit margins.

Even if an area doesn't qualify as underserved under these parameters, a third prong of the definition deems it such if only 40 percent or fewer households within the census block subscribe to broadband service. That's likely to be the case in many underserved areas due to the poor value wireless providers currently offer in terms of high monthly rates for slow speeds barely adequate to support video, high latency and in the case of 3G services, bandwidth useage caps similar to those employed by satellite Internet providers.

Regarding the third underserved qualification -- broadband take up of 40 percent of households or less -- how is that figure to be determined both for the purpose of documenting proposed projects as required under the agencies' guidelines or in the case of disputes? Must those proposing to serve these census blocks engage a polling company to go door to door asking residents if they subscribe to broadband services? That's certain to introduce cost and delay for projects proposing to serve "underserved" areas. And in the case of disputes, will the parties be forced to hire an independent pollster, adding even more cost and delay?

Saturday, July 04, 2009

Australian blogger offers bearish view on U.S. broadband stimulus

Here's what Australian Paul Budde has to say on the U.S. government's rules on broadband stimulus funding released this week:

With countries like Australia and New Zealand implementing infrastructure that can deliver 100Mb/s for their next generation broadband—and with most Europeans not too far behind this—it is quite shocking to see that the $7.2 billion economic stimulus package in the USA (under the RUS Broadband Initiatives Program (BIP) and the NTIA Broadband Technology Opportunities Program (BTOP)) requires nothing more than 768 kilobits per second (kb/s) downstream and 200 kb/s upstream.

I am sure that some of you will think that I have misread this but, no, that is indeed the case.

In 2003 Hong Kong decided not to classify as broadband any service that didn't provide 2Mb/s!

The sad part of the story is that, as this money will mainly be deployed in rural America, this guarantees an enormous digital divide in the USA. AT&T and Verizon already offer FttH services in some of the more affluent suburbs, and they are currently extending these services guaranteeing a progressive increase in the quality of broadband services provided to these markets; however, for the foreseeable future there is little hope of seeing such service quality increase (speed) beyond the major cities.

So far, however, our interpretation, and the comments that I have received from my American colleagues, raises very serious concerns, and represents a massive setback for the deployment of broadband in regional and rural America.

Friday, July 03, 2009

U.S. government formally recognizes broadband "underserved"

One of the notable aspects of the U.S. government's changing policy vis broadband is the formal recognition that much of the nation is served by incomplete telecommunications infrastructure, incapable of delivering advanced telecommunications services.

We're not necessarily talking about remote or deep rural areas of the nation where population density is very low. Rather, it's large areas of the U.S. that can be found in metropolitan areas where service from existing wireline providers goes only so far into a community or down a street or road, creating highly arbitrary pools of broadband winners and losers. Exhibit A: Lots of folks have stumbled across this blog via online searches looking to solve the vexing riddle of why they can't order service while a nearby neighbor can.

The rules governing the disbursement of $7.2 billion in economic stimulus funding to build out broadband infrastructure to unserved and "underserved" areas issued by the federal govenment this week embody the formal recognition of this sad state of affairs:

"The term 'underserved' is not a common term in telecommunications, although it is commonly applied in other fields, such as healthcare, education, social services and retail, to denote populations lacking access to critical services," the rules note.

Newly installed Federal Communications Commission Chairman Julius Genachowski also referred to the problem of the broadband "underserved" before the Senate Commerce, Science and Transportation Committee at his confirmation hearing. The term, he testified, encompasses areas where there are pockets of unserved areas in places that generally have broadband (such as where one neighbor has service while another doesn't).

That's a tacit recognition of the incomplete nature of the nation's telecommunications infrastructure that in too many places is like a half built highway or bridge or at best, a rutted dirt road. Bringing America's telecommunications infrastructure to where it should have been a decade ago and where it needs to be in the future requires a clear recognition that broadband black holes aren't confined to rural areas. Unfortunately, they are comprised largely of Genachowski's "pockets" that are scattered all across the nation and can be found most anywhere and not just in rural areas.

Wednesday, July 01, 2009

Much anticipated broadband economic stimulus rules released

The U.S. Department of Agriculture's Rural Utilities Service and the Department of Commerce's National Telecommunications and Information Administration's much anticipated regulations governing disbursement of $7.2 billion allocated for broadband telecommunications infrastructure in the federal economic stimulus bill enacted in late February were issued today.

At 121 pages, the rules are mind numbingly complex. They're also certain to disappoint many by adopting the Federal Communications Commission's wimpy standard of broadband of just 768 Kbps downstream and 200 Kbps upstream that's inadequate to deliver even low quality video.

"RUS and NTIA favor this broadband speed threshold because it leverages the FCC’s expertise, utilizes an established standard, facilitates the use of many currently common broadband applications (e.g., web browsing, VOIP, and one-way video), allows for consideration of cost-effective solutions for difficult-to-serve areas, and is the most technology-neutral option because it encompasses all major wired and wireless technologies," the two agencies explain in an appendix to the rules. "For these same reasons, RUS and NTIA decline to impose a latency requirement or technology-specific definitions."

That's quite a step down from the speeds Congress contemplated in a January draft version of the American Recovery and Reinvestment Act as minimally defining wireline broadband of at least 5 Mbs download and 1 Mbs uploads and 45 Mbs on the downside and 20 Mbs up for "advanced" wireline broadband. Wireless providers would have had to provide connectivity of 3 Mbs down and 1 Mbs up under the draft legislation that set off howls of protest from both incumbent wireline providers as well as wireless broadband providers complaining those standards were simply too tough to meet. The good news is the RUS and NTIA will give bonus points to projects that will offer higher speeds and an upgrade path to them. And point demerits are given for high latency.

The rules also define another controversial aspect of where the funds will go: areas considered unserved for broadband and underserved. The former is defined as one or more contiguous census blocks where at least 90 percent of households lack access to facilities-based, terrestrial broadband service, either fixed or mobile.

Underserved gets a bit more complex. The rules define it as one or more contiguous census blocks where one or more conditions exist: 1) No more than 50 percent of the households in the proposed funded service area have access to facilities-based, terrestrial broadband service (presumably including fixed terrestrial wireless); 2) No fixed or mobile broadband service provider advertises (yes, advertises, believe it or not) broadband speeds of at least 3 Mbs down and; 3) The rate of broadband subscribership is 40 percent of households or less.

Buried deep inside the rules at page 72 is a troubling broadband black hole preservation provision. It essentially gives incumbent providers (read the telco/cable duopoly) the power to effectively veto or at least delay the award of grants and loans for broadband infrastructure projects proposed by smaller players, local governments and telecom consumer cooperatives. Proposed project areas are publicly disclosed under the regulations. If an incumbent provider doesn't like what it sees, it can file its own application and challenge the upstarts by claiming their project proposes to serve an area that's neither unserved nor underserved.

"If the information submitted by an existing service provider establishes that the applicant’s proposed funded service area is not underserved, both RUS and NTIA may reject the application," the rules state. Moreover, the rules exempt existing providers from the requirement they publicly disclose the area to be served by their projects as well as the tight application timeframe governing other proposed deployments.

The window for this first round of applications is narrow indeed: just one month between July 14 and Aug. 14 after which the bulk of the funding --$4 billion of the $7.2 billion total -- will be awarded. The balance will be disbursed in two follow on rounds of funding with all $7.2 billion due out the door by Sept. 30, 2010. That means those seeking the funds will have to act very quickly to get their applications in order and gather the large amount of information required under the highly data driven, two-step application process.

 
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