Unpacking USTelecom FCC forbearance petition: no obligation to continue copper plant

GN 14-126: USTelecom Comments on 2015 Broadband Progress Report | USTelecom: First, the Commission should grant the petition that USTelecom filed in October 2014 that seeks forbearance from various outdated regulatory requirements applicable only to incumbent local exchange carriers (“ILECs”). As USTelecom explained in its Forbearance Petition, unlike most broadband providers – including cable, wireless, and competitive fiber providers – ILECs are not free to focus their expenditures on next-generation networks designed to deliver the higher-speed broadband services customers increasingly crave; instead they “must direct a substantial portion of their expenditures to maintaining legacy networks and fulfilling regulatory mandates whose costs far exceed any benefits.”

USTelecom is correct in noting there's little point in investing in obsolete copper networks. But its petition to the U.S. Federal Communications Commission fails to cite any regulations that specifically require telephone companies to deliver services solely over copper and not fiber.

Instead, the filing appears to pick a bone with existing rules governing ILEC last mile network operations and access -- rules that are predicated on ILECs having a monopoly over last mile infrastructure. The petition does not explain how these rules operate to discourage investment to upgrade copper networks to fiber.

Expect more legacy incumbent telephone company complaints as the FCC adopts final rules later this year reclassifying Internet service as a common carrier utility under Title II of the Communications Act.

Rhode Island universal Internet service bill introduced

GoLocalProv | Chippendale: Homes Without Internet Access Leave Students Unable to Excel in School: Representative Michael Chippendale (R-Foster, Glocester, Coventry) has introduced legislation that would bring broadband internet to households that currently have no means of accessing it. The bill stipulates that “any public utility providing phone, cable television, or broadband internet service to 75% of the eligible residents of any single city or town shall make available said phone, cable television, or internet services to the remaining 25% of the city or town.” Also, “any broadband service provider which provides internet service to any city or town that is part of a school district that utilizes portable internet devices for student learning at home and has broadband internet provided to at least 25% of the eligible residents of any single city or town, must provide broadband internet service for all residents of the city or town.”

While the U.S. Federal Communications Commission appears to be passing on a universal Internet service obligation in its forthcoming final rules deeming ISPs as common telecommunications carriers under Title II of the Communications Act, this could be the first of a state-based movement to impose such a requirement.

It should be noted this is a limited universal access measure and won't help localities in the all too common scenario where ISPs commonly serve only the doughnut hole of half of all premises -- those close to the center of town -- but not those outside of the center.

Tennesseans want fiber Internet service

More and more areas of the United States are recognizing they need to build fiber telecommunications infrastructure just as they built their own roads and highways. The excerpts below from this story explain why and the growing political sentiment that is reaching a tipping point.

Farm Bureau backs EPB expansions | Local News | Times Free Press: Sen. Todd Gardenhire, R-Chattanooga, said he backs Bowling's bill because his top priority is getting high-speed Internet to rural areas of south Bradley County that are in his district. Some 800 families would benefit, he said.

He said Charter, Comcast and AT&T told him "it's not profitable" to do it. In Gardenhire's view, "private enterprise has given up on taking care of the people."

Some south Bradley Countians are less than a mile from EPB's service area but can't get its broadband, leaving them with dial-up service and a slow connection speed. Joyce Coltrin, whose wholesale nursery is in southern Bradley County, relies on her cellphone to access the Internet.

"It's very hard to use an iPhone for business," said Coltrin, who heads a group of 160 households who call themselves "citizens striving to be part of the 21st century." They, too, have been pushing state legislators to change the law.

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Wireless in particular "is capable of a tiny fraction of what fiber can deliver, with respect to speed, reliability, and capacity," she said. "Because of data caps and usage-based pricing, it's also very, very expensive for anyone who uses a lot of bandwidth, such as families who home-school and therefore require lots of online video." Saying that a community "doesn't need fiber because it has DSL or wireless is like saying that the nation doesn't need the Interstatehighway system because we have the Santa Fe trail," Hovis argued.

Big incumbent telcos, cablecos should stop the zero sum game, partner with the public sector on open access infrastructure

Steven S. Ross of Broadband Communities magazine opines in the January/February 2015 issue that legacy incumbent telephone and cable companies should abandon their win/lose, zero sum, all or nothing attitudes toward telecommunications infrastructure and partner with the public sector on open access infrastructure:

"A well-built municipal system (or access to public assets in a public/private partnership) should be open to all carriers and to all content and service providers. They would get a chance to sell products and services with vastly higher revenue potential and much greater reliability than they would by nursing ancient infrastructure to drain a few extra years of cash out of hapless, captive customers."

Indeed.

Click here to read the full article.

On telecom infrastructure, policymakers must choose between sanctioning market failure or serving their constituents

Rural Tennesseans limited in Internet choices

As time goes on, it’s going to grow increasingly difficult for policymakers to continue to provide protection to legacy telephone and cable companies that want to preserve their partial service area infrastructure footprints. Such protectionist policies amount to government sanctioned market failure.

In the face of market failure, naturally those who live outside the boundaries of those limited footprints are looking to the public sector for help to get landline telecommunications service -- just as they did nearly a century ago for electrical distribution infrastructure. 

If their elected representatives fail to support them, they will face growing political risk come election time, particularly as more stories like this one show they’ve sold out their constituents by taking campaign contributions from the legacy providers.

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.