To Save the Internet We Must Own the Networks | By David Morris | Common Dreams

To Save the Internet We Must Own the Networks | By David Morris | Common Dreams:

The tools to build locally owned networks may well be there as the author of this article concludes. But adequate funding is another question. Constructing telecommunications infrastructure is very costly and labor intensive. It’s far easier to do in places where local municipal and cooperatively owned electric distribution and telecommunications networks already exist and have supporting infrastructure and funding mechanisms in place. Many of these entities got their start in the early in the 20th century with robust federal funding.

Nearly a century later, there is no meaningful federal funding to support the formation of new local entities to construct and operate advanced fiber telecommunications networks. State and local budgets are strained with obligations to repair and replace other aging infrastructure and honor pension obligations to their workers. They can’t be expected to provide billions to finance locally owned telecom networks.

Without government funding in the form of technical assistance grants and loans, expecting property owners and consumers to come up with the money is highly uncertain outside of highly affluent communities. As price takers rather than the price makers they would be the owners of local infrastructure, they are accustomed to purchasing “broadband” as a commodity monthly service and grudgingly tolerating exorbitant monthly costs and annual rate increases from incumbent telephone and cable companies. They’re unlikely to be motivated to put up the money to build an alternative -- albeit better -- network infrastructure than currently available to them unless they live in a neighborhood redlined by the incumbents.

Local ownership of telecom infrastructure is in concept a meritorious idea. But without a coordinated and well-funded federal program for it that recognizes that local infrastructure is essential to a vital interstate telecommunications network and not a local amenity like a park or playground, it remains only that.

FCC's repeal of Open Internet regulation sets stage for mega versions of 1990s era AOL, CompuServe walled gardens

The U.S. Federal Communications Commission has restored the regulatory framework that treats Internet protocol-based communications as an information service. The move reverses the commission’s 2015 Open Internet rulemaking classifying IP as a common carrier telecommunications utility under Title II of the Communications Act. So instead of an open Internet, the United States is turning back the clock to the closed, proprietary walled gardens that existed prior to the advent of the World Wide Web in the mid-1990s.

It’s even a greater back to the future policy move than appears at first glance. It sets the stage for media producers to consolidate with the companies that own the “pipes” – cable and telephone companies that serve more than three quarters of American homes, businesses and schools. After all, if those pipes are to be regulated as information services rather than telecommunications, companies that create information take on an integral role in this vertically integrated business model.

Consequently, the future could bring more combinations like Comcast’s acquisition of NBC or Verizon’s takeover of AOL and its pending deal for Yahoo! Under the new regulatory policy, it’s not inconceivable a big cable company or a telco could similarly make a play for Netflix.

Even Amazon, clearly in the information service business with its original offer of books and now its own production video content, could be a potential merger partner for one of the big pipe players. An Amazon-Verizon walled garden, for example, would provide this information content along with socks, towels and any other imaginable consumer commodity with both companies taking a nick of the revenues. Prime members might be eligible for a discounted monthly rate for Verizon connectivity.

The result would be a supersized version of the original big online information services: CompuServe and AOL. Both provided electronic mail along with content prior to the debut of the Netscape World Wide Web browser in the mid-1990s that swung open the garden gates to a vast digital universe. CompuServe even charged its subscribers by the minute to read “premium” content -- not unlike telephone long distance service. Such a billing scheme might well make a return under the FCC’s latest regulatory framework.

Last year Google abandoned its vision of building proprietary fiber to the home infrastructure to make its content more widely available. It could follow the adage, “If you can’t beat ‘em, join ‘em," and concede its effort to outshine legacy incumbent telcos and cablecos and their outdated metallic telephone and cable TV networks by merging with one of them to create a colossal proprietary information service.

Norman Macrae on telecommunications: Third of three great transport revolutions of past 200 years

Norman Macrae Surveys - help microeducate and microfranchise 3 billion jobs: "Telecommunications are now recognised as the third of the three great transport revolutions that have, in swift succession, transformed society in the past two hundred years. First, were the railways; second the automobile; and third, telecommunications-attached-to-the-computer, which was bound to be the most far-reaching because in telecommunications, once the infrastructure is installed, the cost of use does not depend greatly on distance."

Sens Heinrich, Heller Introduce Bipartisan Legislation To Increase High-Speed Internet Access In Indian Country | Benton Foundation

Senators Martin Heinrich (D-NM), Ranking Member of the Joint Economic Committee, and Dean Heller (R-NV) introduced the Tribal Connect Act of 2017 to improve broadband connectivity in Indian Country. The bill would increase access to the Federal Communications Commission's schools and libraries universal service support program, known as E-rate, that provides discounts to assist public schools and libraries obtain high-speed internet access and telecommunications at affordable rates.

Sens Heinrich, Heller Introduce Bipartisan Legislation To Increase High-Speed Internet Access In Indian Country | Benton Foundation

This is misguided policy that emulates the market segmentation strategy employed by incumbent telephone and cable companies that produced the very access disparities prompting this bill. Instead of targeting certain areas, buildings or ethnic groups, American telecommunications policy should be to construct fiber to the premise telecom infrastructure serving all -- and not just some -- premises.

As feds reclassify Internet as information service, will state and local governments finance fiber telecom infrastructure to deliver it?

With Net Neutrality Vote Looming, Cities Look to Publicly Owned Internet Options: (TNS) — It's going to cost somewhere between $70 million and $140 million, officials estimate, to build out the underground fiber-to-the-premises network that Boulder needs to make communitywide broadband a reality. The question for the City Council has never been whether this pursuit is worthwhile, as voters and elected leaders clearly agree on the value of open-access, affordable, high-speed Internet — the introduction of which would put pressure on the incumbent Comcast-CenturyLink duopoly to lower their prices and offer higher speeds. Rather, the question is: Who is going to pay for this buildout? And, for much of the past year, based on advice of a consultant, Boulder has paid $186,000 to date, the most likely answer seemed to be that the city would partner with an outside provider willing to pay for the buildout.

The economic question here is will households and businesses be willing to pay what they now pay for landline Internet access in the form of a tax or utility fee? This question now takes on greater significance as the federal government prepares to reclassify Internet service as an information rather than telecommunications service. That would leave building the fiber telecom infrastructure to deliver those information services to states and localities.

A related question is whether this hands off federal regulatory policy will prompt states to repeal existing statutes restricting the construction of telecommunications infrastructure owned by local governments? It would be difficult for states to justify maintaining these restrictions if the federal government doesn't consider Internet service as a telecommunications utility.

Legacy incumbent telcos, cablecos not entitled to state sanctioned monopoly without FCC enforcement of Title II universal service requirement

Colorado Localities Vote for Broadband, but Must Get Creative to Actually Deploy It: “Cities don’t do this because they want to compete with the incumbent — they do it because the incumbent refuses to,” said Tom Roiniotis, general manager of Longmont Power & Communications, which runs the network.

Why the refusal? One big incumbent legacy telco explains: 

Mark Soltes, CenturyLink’s assistant vice president in Colorado for public policy and government affairs, said the gaps in service across the state are due to rugged landscapes and far-flung population centers. “You’re looking at deployment in some places where there’s no payback,” he said.

That's the economic reality and there's nothing unreasonable in CenturyLink's justification. It owes its investors a profitable return. But if a public sector entity steps into the gap where the numbers don't pencil for CenturyLink or other legacy incumbent, that's hardly market competition. In an open market, competitors compete for market share and profitable business. That's not the case when a public sector entity provides an essential telecommunications utility that's not being provided a private sector player because there's not a sufficient business case to do so. It's simply serving the need where the private sector cannot.

Nor do incumbent telcos and cablecos have a right to a state sanctioned monopoly. Particularly when the U.S. Federal Communications Commission is not enforcing the universal service and anti-redlining requirements of its current Open Internet regulations based on Title II of the Communications Act and is poised to repeal those rules later this month. If the FCC did enforce the rule, then the incumbents would have a far stronger and reasonable position. At present, they do not.

FCC Chair Pai's distorted take on America's telecommunications infrastructure challenges

Why deregulating internet service makes sense - Chicago Tribune: FCC Chairman Ajit Pai says CEOs, investors and entrepreneurs are in the best position to invent and give consumers what they want, so they should be allowed to compete. “The No. 1 issue that I hear about is that people want better, faster, cheaper internet access,” Pai told The Wall Street Journal earlier this year. “They want access, period. To me at least, that’s the question the FCC should be squarely focused on: What is the regulatory framework that will maximize the incentives of every company to deploy the next generation of networks?”

This brings to mind the adage that to a carpenter, problems generally appear as protruding nails needing to be hammered down. So it's no surprise that to a regulator, America's telecommunications infrastructure deficiencies are a regulatory problem calling for a sharp whack of the regulatory hammer. Or in Pai's words, an overgrown regulatory thicket of weeds calling for the application of a weed whacker.

The problem is Pai has incorrectly framed both the problem and the solution. America's disparate and costly telecommunications services and particularly those serving buildings where people live, work and attend school are not caused by excessive regulation. In fact, the reverse could be plausibly argued. The Federal Communications Commission current Open Internet rules classifying Internet service providers as telecommunications common carrier utilities under Title II of the Communications Act require them to fulfill reasonable requests for service and not discriminate based on a customer's address. That operates so as to force them to upgrade and build out their networks to honor those requests.

Rather, they are primarily due to overreliance on legacy telephone and cable companies to make the necessary capital expenditures to transition their metallic cable plants to fiber. And to do so at a rapid pace in order to meet the burgeoning demand for connectivity of which Pai speaks. Their business models that require quick profits can't do that because it can take many years to achieve profitability on telecommunications infrastructure that costs many billions of dollars.