Thursday, November 20, 2008

Tensions erupt between telcos, cablecos over over California broadband build out subsidy levels

As recently reported on this blog, California's incumbent telcos are bitching to the California Public Utilities Commission, complaining a 40 percent subsidy to underwrite the cost of building out broadband infrastructure to areas of the state lacking adequate access under the CPUC's California Advanced Services Fund (CASF) isn't likely to be enough for many potential projects.

Now the griping has turned into a contretemps between some of the biggest players and Comcast has jumped into the fray. In comments filed Nov. 19 on the eve of a CPUC hearing today to consider restructuring the CASF, Verizon criticizes AT&T's suggestion the 60 percent provider match be abandoned, warning it could lead to too much state funding of some projects.

In its Nov. 19 comments filed with the CPUC, cable provider Comcast takes issue with AT&T's "incredible" suggestion that the CASF fully subsidize some projects and Verizon's proposal that the CASF share be increased up to 80 percent for selected projects. The cable company warns the higher CASF funding threshold would be contrary to the CASF's goal of funding only projects that are economically viable.

AT&T's suggestion that CASF provide 100 percent funding for selected high cost projects in unserved areas "is truly outrageous, particularly coming from AT&T," Comcast said in its filed comments. "The CASF was not set up to be a slush fund to cover 100 percent of the costs of the largest ILEC in the state."


Anonymous said...

We have a disconnect in this CBTF project goal to connect the unserved and underserved in rural areas. If it is true that CASF has a goal of "funding only projects that are economically viable", then deployment to most rural areas will not be possible. The Mendocino Coast Broadband Alliance has done a feasibility study which shows that potential providers will need to be very creative to break even in our area because of the low population numbers over large areas. I believe that the goal of the California Broadband Task Force (CBTF) is ubiquitous broadband in rural areas without a restriction of economic viability. I think CASF was set up as an incentive to make it more possible for telecos to offer the mandated deployment. It is a subsidy to cover the possible shortfall. Reality is that all residences and businesses MUST have broadband to participate in this technological age for the good of the economy in those areas as well as the personal good. Dialup will be useless to obtain the basic services online in a very few years. Let's look at the needs of the end users first and not just have the provider in-fighting. Let's find a way to fund the gap in the middle between what funds cover and what makes it at least break even as a public service. Let's take on the challenge and work together toward the goal for the good of the people not just the bottom line of the telecos.

Anonymous said...

The CBTF shouldn't be paying for ANY of the build out costs!

They should be fining teleco's per customer for every month they don't recieve such an essential service!

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