Legacy telephone companies’ power isn’t so much lobbying as controlling the narrative

Conventional wisdom holds the United States is unable to timely modernize its legacy copper telephone infrastructure to fiber reaching every doorstep because of the lobbying power of big legacy telephone companies. They want to protect their natural monopolies against interlopers and deploy fiber only where it produces a rapid return on investment to select neighborhoods at highly profitable, unregulated prices.

But their more formidable power isn’t so much their armies of lobbyists and campaign contributions to public policymakers. It’s that they’ve established and controlled the narrative built around a single word: broadband. They were so successful that they even managed to get public interest-oriented officials and advocates to adopt the term, creating a decades-long obsession with chasing “broadband” bandwidth instead of concentrating on advanced telecommunications infrastructure that delivers that bandwidth. It also serves as a great distraction since fiber technology has been around for decades and was being considered by telephone companies as early as the 1980s for two-way video communications.

It began with the enactment of the Telecommunications Act of 1996, at a time when Americans used screeching modems to connect to online services such as CompuServe and America Online. The statute defined progress as advancing from that narrowband dialup service to “always on” broadband. It largely left it to the private market to set the course instead of stating industrial policy establishing fiber as the universal infrastructure standard as twisted pair copper was before it. As well as establishing a timeline so that fiber reached nearly all homes by 2010. Instead, more than a decade later, only about one third of all U.S. homes can get a fiber connection. Baked into the 1996 Act is a cognitive bias known as anchoring. Dialup -- state of the art connectivity at the time it was enacted -- is the anchor. Any technology offering incrementally greater throughput came to be valued more highly than modernizing legacy copper telephone lines to fiber.

Lacking a fiber infrastructure standard, in the quarter century since the 1996 Telecommunications Act was enacted, America has found itself bogged down in incrementalism, debating the definition of broadband and even trying to map its location. Elected officials have been dogged by constituent complaints over spotty, poor and unaffordable Internet access, priced at whatever the market will bear. Those complaints grew more strident as time went on and especially during the COVID-19 pandemic that turned homes into offices, classrooms and medical clinics.

With telephone companies dragging their feet on transitioning to fiber in order to accommodate their short term oriented business models, cable TV companies leveraged their coaxial cable to provide Internet access in the decade since the Act was signed into law. Since they have not been regulated as telecommunications carriers with universal service mandates and price controls, they too can -- and do -- charge whatever the market will bear. And bear it the market must since cable has taken a dominant role, putting it in a controlling position.

Seeing that fiber was being slow walked at the same time people grew more desperate for connectivity, various wireless technologies and even satellite services came about to fill the fiber voids. The sad consequence is the nation once seen as a world leader in telecommunications no longer is.

AT&T's Stankey misrepresents true high cost component of fiber to the home

AT&T CEO John Stankey yesterday called President Biden's plan to fund municipal broadband networks "misguided" and said the US shouldn't pay for any broadband deployment in areas that already have networks. But as AT&T and other ISPs lobby against public networks and government-funded competition, Stankey said he is confident that Congress will steer legislation in the more "pragmatic" direction that AT&T favors.

In an interview with The Economic Club of Washington, DC, (video), Stankey was asked, "Do you support the president's proposal to have municipalities own broadband facilities?" Stankey responded, "I think actually the president's proposal is probably a bit misguided in that regard." "It would be a shame that we take taxpayer money or ask local governments to go into a business that they don't run today," Stankey said. "You know, their job is to deliver water, patch streets, things like that, not be in a capital-intensive technology business that requires constant refresh and constant management." (Emphasis added)

https://arstechnica.com/tech-policy/2021/06/att-ceo-seems-confident-industry-can-kill-bidens-municipal-broadband-plan/

Actually, the most capital intensive element is constructing fiber to homes -- largely labor costs -- not equipment refreshes and management. This is where AT&T can play a role since public sector and nonprofit entities like consumer telecom cooperatives could benefit from an operator with AT&T's experience managing fiber.

Neither AT&T nor any other legacy telephone company can afford to own, build, maintain and manage fiber on a scale America needs considering every doorstep should have had fiber connections no later than 2010. The lack of those connections with only about a third of homes having them became painfully apparent during the social distancing public health requirements in response to the COVID-19 pandemic that turned homes into offices, classrooms and clinics.

To Fix America's Infrastructure, Start Here

Such has been the state of infrastructure in the U.S. for decades — fixes get put off until they’re absolutely necessary, and U.S. airports, roads and public transportation draw frequent comparisons to those in nations with far fewer resources. Meanwhile, countries in Europe, Asia and the Middle East have leapt ahead with so-called smart cities, high-speed trains and eco-friendly buildings. In 2019, the U.S. ranked 13th in the world in a broad measure of infrastructure quality — down from fifth place in 2002, according to the World Economic Forum’s Global Competitiveness Report.

Source: How to Fix America's Infrastructure

When it comes to advanced telecommunications, it's even worse. Progress has been impeded for decades because it hasn't even been regarded as critical infrastructure but rather a commercial service of providing "broadband" bandwidth and service bundles to qualifying households. That's changing with the Biden administration's proposed infrastructure investment plan, the American Jobs Plan, that regards telecom as critical infrastructure and as such, it cannot be left to the private market to build it.

As the administration makes a long overdue shift of the policy discussion from broadband to infrastructure, it must be careful not to allow legacy investor owned telephone and cable companies to continue to control the narrative by focusing on broadband bandwidth as they have for the past quarter century. (Or that the problem is largely confined to rural areas when only one third of U.S. homes are passed by fiber.) It's evident in their complaints that publicly or consumer cooperative owned fiber to the home would be wasteful "overbuilding" arguing their limited deployments provide sufficient bandwidth. 

Similarly, consumer advocates and public policymakers should avoid falling into the bandwidth trap by calling for more and better "broadband maps" showing what bandwidth is offered in a given neighborhood. The goal should be fiber connections to nearly every American doorstep, a goal the private sector cannot achieve quickly enough relative to the need that has been heightened during the public health restrictions accompanying the COVID-19 pandemic.