No need for maps of existing advanced telecom infrastructure with "public option" fiber reaching nearly every American home.

According to Sherry Lichtenberg, deputy director at the National Regulatory Research Institute, having a big sum of money with which to attack the digital divide will be important, but the key issue may actually be figuring out where to spend it all. “We still don’t really have a good map that shows where things are available,” she said. “It’s important to know who’s got service, who doesn’t have service, where service could be provided if somebody asked for it, and where people are really getting it even if they are asking for it because of the way the rules are written.”

 It Will Take a Lot More Than Money to Fix the Digital Divide

There is no need for maps of existing advanced telecom infrastructure provided the Biden administration's proposed infrastructure plan offers affordable "public option" fiber connections to nearly every American home. It's already known that only about one third of U.S. homes are passed by fiber, most of it built by investor owned providers that limit construction to cherry picked neighborhoods. 

That's unlikely to change anytime soon since their business models demanding rapid returns on capital investment drive them to target dense MDU and greenfield development. They also charge a price premium for fiber throughput, marketing it as high end "gigabit" service that makes higher income areas a priority for fiber infrastructure deployment.

Selling vertically integrated "gigabit" service inefficient, reinforces disparate access

What it's like to take on Google Fiber in Nashville: One firm's take - Nashville Business Journal: For more than two years, Nashvillians have salivated over the eventual arrival of Google Fiber, super high-speed internet courtesy of one of the world's most idolized tech companies. But while Google has yet to share specifics on when that network will officially launch in Music City, other players have made their own moves. Most notably, legacy telecoms AT&T and Comcast have launched their own networks, but smaller players like Shelbyville-based Athena Broadband are also getting in on the gigabit game.

This is a disturbing pattern that reinforces America's crazy quilt, disparate access to advanced telecommunications service. Given the high cost of constructing telecommunications infrastructure, it would be far more efficient to have a single entity build it and allow various Internet service providers to offer services over it. Instead, the U.S. continues to emulate the failed monopolistic vertically integrated business model of the legacy telephone and cable companies with its neighborhood cherry picking and redlining that have led to the nation's widespread access disparities.

Sell fiber enabled services, not “gigabit.”

There’s a well-established maxim in the sales of information and communications technology (ICT) products and services: Don’t sell bits and bytes, feeds and speeds. Instead, sell features and benefits. There’s a good reason for this selling principle. Most consumers aren’t interested in technology. They’re interested in what it can do to benefit them and its value for the money invested.

The same rule applies in telecommunications. But it has been violated in the marketing of fiber to the premise (FTTP) services, where Internet Service Providers have defined FTTP by its speed – its ability to deliver bandwidths of 1 gigabit or more. Problem is, only a small percentage of consumers really know what the term “gigabit” means, according to a survey by Pivot Group spotlighted in the January/February issue of Broadband Communities magazine. (Sell Services, Not Speed)

“Service providers spend an awful lot of time and marketing spend emphasizing speed, but this research reveals consumers are confused regarding speed references and perceive that their current speed package is sufficient,” Dave Nieuwstraten, president of Pivot Group and co-author of the study, observes.

The takeaway: What really matters isn’t gigabit bandwidth per se but rather the services FTTP can enable in the home where people have high definition televisions, desktop and laptop computers and personal devices such as tablets and smartphones all being supported by the home’s Internet connection. FTTP will play an increasingly important role in the delivery of video content as more is delivered via the Internet, enhancing its value to consumers sensitive to high price points for Internet service used to support only web browsing and email. That will increasingly be so as live sports migrates to Internet streaming.

In the era of FTTP, it’s really no longer useful to market bandwidth or brand it with a speed-based term such as "gigabit” or “broadband” -- a now obsolete term used in the 1990s to distinguish narrowband dialup Internet access from first generation ADSL services. Similarly, marketing Internet services with speed/bandwidth price tiers is no longer truly relevant for premise services. Without benefits described, consumers will naturally tend toward lower cost options.

Emphasizing the utility and benefits of a FTTP connection also fits well with the open access, wholesale model where the owner of the FTTP infrastructure sells access to ISPs who in turn sell retail services delivered over it. Including new ones mentioned in the Broadband Communities article such as installing and supporting the next generation of more robust home Wi-Fi needed to enable all of those wireless devices being used in today’s homes and home-based businesses.

Gigabit over fiber altering telecom landscape

One word is exerting substantial influence over U.S. telecommunications infrastructure: gigabit. It is literally exponentially redefining what constitutes modern premises Internet connectivity from megabits per second (Mbs) range to gigabits per second (Gbs).

Gigabit is also aiding in a shift of market power to the demand side and away from legacy telephone and cable companies that supply megabit class service – often in the single digit Mbs range in the case of telcos -- over “last mile” metal wire or cable to customer premises. The limitations of this infrastructure versus fiber optic lines easily capable of delivering gigabit class service have led telephone and cable companies to ration bandwidth, selling it in various “bandwidth by the bucket” consumption tiers like electricity or natural gas. Gigabit over fiber to the premise will obsolete that business model at the same time premise bandwidth demand continues to rapidly accelerate. Drivers include more and higher definition video streams, multiple devices in the home and emerging Internet-enabled home services. Also, more knowledge workers working at home at least part of the work week.

Gigabit over premises fiber service will also obsolete the legacy telcos and cablecos themselves, burdened with decades-old twisted pair and coax cable infrastructure as well as high debt and shareholder dividend obligations. That will give advantage to agile and financially creative overbuilders connecting premises with fiber service.

Since telecommunications infrastructure is a natural monopoly, once fiber first movers have established a substantial market presence, the economics of challenging them with parallel infrastructure become very difficult. This same dynamic has historically deterred those who would overbuild the incumbent telcos and cablecos. But the shift toward gigabit class service delivered over fiber could reverse the advantage of incumbency the legacy telephone and cable companies have enjoyed for more than a decade.

The first mover advantage would be particularly high in parts of incumbent telephone and cable company service territories where the incumbents don’t offer landline Internet connections or very slow ones such as first generation DSL.

“Broadband” infrastructure subsidy programs falling behind in the gigabit world

As telecommunications becomes an Internet-based, fiber delivered service, programs aimed at subsidizing the cost of infrastructure construction are rapidly going out of date. For example, the U.S. federal government’s Connect America Fund helps underwrite the cost of building infrastructure in areas with service providing Internet connections of less than 3 Mbs down and 1 Mbs up. The California Advanced Services Fund targets areas with less than 6 Mbs down and 1.5 Mbs up. Both definitions are now technologically obsolete in that they are purposed for “broadband" service and define "broadband" based on a moving and quickly obsoleted throughput target that only measures speed but not latency or jitter --  key components of throughput quality.

It's no longer a broadband environment where the term broadband was used to distinguish advanced services from 1990s "narrowband" dialup. It's now a "gigabit" world of fiber to the premise (FTTP) that can provide exponentially superior throughput with no near term threat of obsolescence.

In addition to using an outdated and incomplete measure of throughput, these programs are deeply flawed insofar as they aim to preserve the hegemony of the legacy metal wire-based legacy telephone and cable companies with eligibility standards based on the companies’ need to constrain bandwidth on their bandwidth-limited metal wire plants. Program subsidies are only available in areas deemed “underserved” and “unserved” relative to services provided – and not provided -- by the incumbents. 

This isn't a practical definition since the footprint of wireline-based services of the incumbents is highly granular at the network edge due to market segmentation and arbitrary redlining of discrete neighborhoods deemed undesirable and therefore unserviceable.

For the most part, the large first tier incumbent telcos and cablecos have spurned the subsidies, probably because they are far too limited to allow them to significantly upgrade their plants to FTTP. They also likely realize accepting subsidy funding would potentially increase pressure on them to provide service to all premises in their service territories as some advocate, urging the U.S. Federal Communications Commission to regulate the Internet under a common carrier scheme like that in place for decades for voice telephone service.

Two sharply divergent alternative business models for Internet infrastructure play out in Utah

For the past decade, much of the United States has been plagued by telecommunications infrastructure market failure. Many residences and small businesses need fast, reliable landline premise Internet connections but are unable to obtain them because legacy telephone and cable companies have opted not to upgrade and build out their networks to reach them. Alternative business models are thus urgently needed to ensure they don’t remain isolated from the Internet grid and effectively cut off from the many services it provides.

In Utah, two alternatives to construct and operate fiber to the premise (FTTP) infrastructure -- which is also being referred to as “gigabit broadband” in reference to fiber’s substantial carrying capacity that eliminates sluggishness and latency -- are playing out in close proximity.

One model is quasi-public, the other private. The first is the Utah Telecommunication Open Infrastructure Agency (UTOPIA), of which 6 of 11 member municipalities are moving forward with diligence on a partnership to bring in private investment capital. (Story here) UTOPIA’s model treats its fiber infrastructure as a public asset similar to roads and highways. 

By contrast in nearby Provo, Google’s Google Fiber unit is utilizing the subscription-based business model used by legacy telephone and cable companies to sign up residential (but not business) customers living in selected “fiberhoods.” Google Fiber is open only to Google whereas the UTOPIA model allows Internet Service Providers access to the network on a wholesale basis.

Since Google Fiber sells subscriptions like a magazine, it has to sell enough subscriptions to be economically viable. Being part of online advertising giant Google means Google Fiber is also motivated to get as many subscribers as possible in order to maximize eyeballs on Google-delivered content and ads. With the bill and keep subscription model, teaser and special rates are utilized to goose subscriptions such as Google Fiber’s announcement it is cutting its $300 flat rate, low cost subscription rate to only $30 for a limited time in Provo fiberhoods – similar to limited time magazine offers for new subscribers. (See this item from Google Fiber blog)

Of these two models, the UTOPIA model despite initial resistance to a modest public utility fee is best able to scale quickly enough to address America’s significant telecommunications infrastructure gaps short of a massive federal infrastructure program on the scale of the Federal Highway Act of 1956. The public-private partnership model being utilized by UTOPIA relieves network operators of the risk burden and uncertainly associated with having to sell subscriptions and avoid customer churn. It can also more easily attract the many billions of dollars necessary to build out fiber to nearly all Americans regardless of where they make their homes and businesses.