FCC looks into rural call completion problems - The Hill's Hillicon Valley

FCC looks into rural call completion problems - The Hill's Hillicon Valley: In a statement, Chairman Julius Genachowksi said the evidence of rural call completion problems is overwhelming.

"In too many towns across the country, the basic ability of all Americans to reliably receive phone calls — a bedrock of America’s communication policy — has come into doubt," he said. "This has serious economic, safety and other consequences."

The United States faces serious telecommunications service problems with 20 million Americans disconnected from premises Internet service and now voice phone service becoming spotty in rural areas.

In his State of Union address one year ago, President Obama pointed to the nation's "incomplete high-speed broadband network," calling on Congress to fund telecom and other critical infrastructure.  Let's see if the President revisits this continuing problem in this week's 2013 State of the Union address.

It's time to halt the "digital literacy" baloney and build fiber

With many areas of the United States lacking adequate fiber optic infrastructure to deliver premise Internet service, there continues to be an unfortunate effort to shift the focus away from that fact.

For example, this Texas Broadband Summit "designed to engage, educate, and equip technology providers and Texas communities with the resources and partnerships necessary to improve broadband access, adoption, and use," noting that "lack of digital literacy and the digital divide remain real issues in Texas."

What does "digital literacy" have to do with getting IPTV, VOIP and other Internet protocol-based services over fiber?   Nothing, because people have been watching TV and making phone calls for decades.  In that regard, they are already digitally literate.  And the web and email have been around for two decades and most people currently use these common services.

It's time to stop the PR baloney and work on alternative ways of building fiber to the premise -- such as community cooperatives and municipal fiber -- to fill in the gaps that investor owned telco and cable TV providers are unable to fill.

Protecting investor-owned Internet providers from market failure is bad public policy

This USA Today profile of Lafayette, Louisiana's municipally-operated fiber to the premise network raises significant policy questions as to the proper role of the private and public sectors in providing premise Internet connectivity. It notes Lafayette like other community fiber projects faced significant resistance from private sector telco and cable providers bent on preserving their territorial hegemony even when their business models don't permit them to upgrade their networks to provide robust Internet connections to homes and businesses. The push back comes in the form of lawsuits, public information (or disinformation campaigns, depending on one's perspective) and state legislation barring local governments from building publicly owned and operated telecommunications infrastructure.

It's understandable the incumbent telco and cable companies would want to protect their service territories from competition given that telecommunications infrastructure -- like roads and highways -- tends to be a naturally monopolistic (or at best, duopolistic) market. That kind of market creates a winner takes all situation in which the winners in turn pick winners (those who are provided good Internet service) and losers (premises deemed too costly to serve and left off the Internet grid). Their problem, however, is the losers are naturally getting restless and petitioning for relief such as recently proposed Colorado legislation designed to lay the groundwork for the state to directly serve areas lacking connectivity.

The incumbent telco and cable companies may wish to rethink their current strategy of locking down failed markets and barring the door to public providers. The courts could well cast a jaundiced eye toward such uncompetitive market conduct and state laws designed to preserve what in many areas of the nation have become telecommunications backwaters due to what President Obama described in his January State of the Union address as "incomplete" Internet infrastructure.

I'm not sure those state laws could survive judicial scrutiny in the federal courts as they effectively create a state sanctioned monopoly in telecommunications. But unlike other nations, the state doesn't actually provide the service. Instead, their function is to protect private investor owned providers from the consequences of market failure. That's poor public policy because it leaves too many effectively disconnected from the Internet and the economic, educational and other benefits it affords.

Incumbent providers may also want to considering partnering with communities instead of fighting them. As the USA Today article notes, businesses approached Lafayette about expanding the network throughout the city as a way of drawing businesses. City leaders asked BellSouth and Cox representatives to partner on the project. But they spurned a private-public partnership that could have allowed them to share in the revenues, instead opting for a short sighted win/lose strategy.

Blair Levin stuck in the failed paradigm of investor owned telecom infrastructure

Blair Levin, who exited as executive director of the Omnibus Broadband Initiative at the U.S. Federal Communications Commission in May to become a fellow at the Aspen Institute, has penned a white paper issued last week by the think tank calling for retasking the Universal Service Fund (USF) from subsidizing basic telephone service in high cost areas to defraying the cost of deploying advanced telecommunications infrastructure.

Specifically, Levin advocates $10 billion in USF funding subsidize infrastructure capable of supporting the FCC's current minimum throughput standard of 4 Mbs down and 1 Mbs up to nearly all premises by 2020. Levin also proposes using USF funding to support "the adoption of broadband by low-income Americans and other non-adopter communities."

Levin's paper is based on some fundamental flaws. Levin has confined his thinking to the investor owned telco paradigm whose market failure is responsible for the inadequate, incomplete and outmoded telecom infrastructure that plagues much of the United States today in rural, quasi rural and metro areas. This infrastructure needs a massive revamping and it won't happen with just $10 billion in USF subsidies. In an interim report on its National Broadband Plan released in September 2008, the FCC estimated it would cost as much as $350 billion to build next generation telecom infrastructure to serve 100 million American homes. Ten billion dollars by comparison would barely make a dent.

This isn't to argue for much larger USF subsidies to telcos. Instead of appropriating $10 billion to subsidize infrastructure that will be obsolete well before 2020, the U.S. should face the fact that incumbent investor owned telcos simply can't afford to deploy the next generation of Internet protocol-based telecommunications infrastructure in a timely manner. The business case just doesn't pencil out. AT&T essentially conceded this point in a Dec. 21, 2009 filing with the FCC, pointing to the "enormous" amount of capital necessary to complete the build out of required infrastructure to ensure all Americans have access to IP-based services just as basic telephone service is nearly universal.

Instead of Levin's failed private market model, the U.S. instead should support policies that treat advanced telecommunications infrastructure as a public infrastructure like roads and highways such as advocated by Andrew Cohill and others. Allowing the private sector to attempt to build this vital infrastructure is economically untenable.

Levin's proposed use of USF monies to support "adoption of broadband by low-income Americans and other non-adopter communities" unfortunately amplifies a cynical canard advanced by legacy telcos and their astroturf groups. The unstated goal is to lower expectations and keep the calendar fixed in 1999 when Americans were just beginning to adopt "broadband" and "high speed" Internet access in personal computing. The Internet protocol-based infrastructure America needs now and in the future isn't just about computers connecting to the Internet for email and viewing web pages. It will support voice, video, teleconferencing, telework, telemedicine and uses that haven't yet been conceived.

Telecom caught at crossroads of change without a sustainable business model

IBM has issued a comprehensive outlook on the future of the telecommunications industry. To summarize, it describes an industry caught at the crossroads of change amid rapid growth of Internet protocol-based telecommunications without a sustainable business model. No surprise there since telecom as an industry -- like the cable industry -- is based on a closed, proprietary system put in place many decades ago to deliver voice or television programming over copper cable plant. It wasn't designed with the Internet in mind and thus doesn't have a cheap, easily executable upgrade path to put it in tech speak.

Moreover, neither telcos nor cable providers have a business model that will allow them to construct next generation, Internet protocol-based fiber to the premises infrastucture that can deliver multiple digital services to most all premises within their service areas. America's biggest telco, AT&T, admitted as much in a statement published in the New York Times yesterday directing customers not served by its wireline plant to its "broadband" satellite service.

Their corporate cultures naturally resist change. That's why they deploy battalions of lawyers, lobbyists, flacks and astroturf groups to defend the status quo and fight the future while preserving their conservative, risk averse business models based on the incremental billing schemes of the past -- even though these schemes are not a good fit with next generation telecom services.

Consequently, I believe we'll see a combination of the "Market Shakeout" and "Survivor Consolidation" scenarios in the IBM forecast come to pass. In fact, it could be aruged the "Market Shakeout" scenario in which "government, municipality and alternative providers extend ultra-fast broadband to gray areas, while private infrastructure investments are limited to densely populated areas" has been already playing out over the past several years.

Cruel irony of incomplete telecom infrastructure plays near Wisconsin state capital

One of the cruelest ironies of America's incomplete telecommunications infrastructure is playing out not far from Madison, the capital of Wisconsin. The town of Berry, population 1,124, isn't large enough to attract investor owned providers. But at the same time, the incumbent provider, TDS Telecommunications, claims the federal government declined its request for subsidies for infrastructure improvements through funding earmarked for this purpose in the American Recovery and Reinvestment Act of 2009 because the town -- located just 20 miles from the capital -- isn't considered underserved, according to TDS Telecommunications.

The Milwaukee Journal Sentinel reports Berry is has filed a complaint with the Wisconsin Public Utilities Commission saying TDS Telecommunications is failing to provide required service to the community. Community residents contend the poor level of service is making it difficult to work remotely from home and is making their properties less marketable.

The good people of Berry and their town leaders would be well advised to take matters into their own hands and begin working on a Plan B that could get them improved service faster than their PUC complaint, which could end up in the courts and take years to resolve even if they prevail. They should begin planning today to build publicly (or if that's not feasible cooperatively) owned fiber to the premises infrastructure.

What do fuel efficiency standards and broadband have in common?

Like the decades-long policy debate over fuel efficiency standards for automobiles, a new one is springing up. This time it's over minimum broadband speeds with incumbent telecommunications providers arguing for lower standards and consumers demanding higher numbers.

Free Press advocates for a "future proof" telecommunications infrastructure. Based on current, proven technology, that means fiber optics to the premises. Free Press also correctly observes that unlike automotive technology that can be incrementally improved to deliver more fuel efficient vehicles, telecommunications is basic infrastructure and thus requires the right choices to be made up front to protect it from obsolescence and provide sufficient flexibility to accommodate both current and future needs.

Fortunately, there's a way around this debate, which the Federal Communications Commission will soon discover is unlikely lead to a useful outcome or do anything to improve America's fragmented and inadequate telecommunications infrastructure. It's empowering local governments and nonprofit telecommunications cooperatives to build and own their own fiber telecommunications infrastructure -- and ultimately define broadband on their own terms.

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.