America’s long struggle to modernize its legacy metallic copper telephone and coax cable TV telecommunications delivery infrastructure to fiber – now in its fourth decade – continues as 2023 begins.
The legacy providers are selectively deploying fiber that doesn’t pass a large majority of American homes. A policy of universal service/non discrimination that existed with voice telephone service under Title II of the federal Communications Act that regulated it as a common carrier utility would speed up the transition.
However, U.S. policy regards Internet connectivity as a discretionary information service like America Online and CompuServe were in the 1990s and not as a telecommunications utility. This is notwithstanding public health measures taken during the COVID-19 pandemic that boosted the need for Internet access, clearly establishing it as a de facto utility.
Not being regulated as a common carrier telecommunications utility that would mandate Internet service be provided to any customer who reasonably requests it, legacy landline providers lack incentive to upgrade and build out fiber to all addresses in their service territories. Accordingly, they deploy fiber only in select market segments or “footprints” compatible with their business models that demand rapid ROI and high ARPU in line with investor expectations. Moreover, there is no policy explicitly linking subsidies to support fiber construction and operation in high cost areas of the nation to support universal service as with voice telephone service.
Subsidy programs instead of supporting comprehensive modernization to fiber instead are largely a mix of multiple one-off grants to increase throughput or “broadband speed” in a discrete geographic area. Eligibility requirements typically exclude funding for fiber in these areas where incumbent providers -- including mobile wireless carriers -- advertise throughput meeting a minimum standard regardless of whether it can be delivered.
That has sparked tensions between states and the federal government over the latest and largest grant program under the Infrastructure Investment and Jobs Act of 2021 (IIJA) appropriating $43.45 billion as grants to the states for the construction of advanced telecommunications infrastructure. States complain grant eligibility requirements are based on outdated and unrealistic data that will leave them shorted. Even so, the total grant dollars are insufficient to bring fiber to most every American doorstep excepting extremely remote and isolated locations, consistent with the history of vastly oversubscribed grant programs where applications far exceed available funds.
A watershed moment could come in 2023 as disgruntled states and their elected representatives – who have heard constituent complaints about poor access to service for many years -- revolt against the federal government, concluding federal policy is aimed more at erecting barriers to progress and protecting legacy telephone and cable companies than serving their residents.
Consequently, states could openly defy the federal government and broadly devise their own policies to create near universal fiber access and to support construction and operational costs, using their bonding capacity to underwrite them. These would be significant sums that for some states could equal the amount the IIJA allocated for the entire nation.
In order create the policy foundation, states would have to deem fiber as essential to their residents and economies as roads and highways, contracting with private sector providers as they do for transportation infrastructure to design, build and maintain this advanced telecommunications infrastructure.
No comments:
Post a Comment