Concerns raised over Florida broadband franchise bill

The bill bans the government from forcing utilities to build out their infrastructure to offer services to all neighborhoods. But it also names the attorney general as the agent responsible for enforcing antidiscrimination rules, giving the office the power to fine utilities not in compliance.

The antidiscrimination provision seems to be open to some interpretation, with the antibuildout language giving companies accused of discriminating a strong leg to stand on.

Brad Ashwell, consumer advocate for Florida Public Interest Research Group, said that while rates may drop initially, he expects gradual increases over time. "This bill doesn't guarantee that everyone is going to be served or enjoy the benefits of 21st century technology."

How Comcast perpetuates broadband black holes

Even though it’s now free to expand its service area and apply for a statewide franchise from the California Public Utilities Commission, so far cable provider Comcast has not. It could be because it prefers to remain under existing franchises issued by local governments that impose no future build out requirements. California’s Digital Infrastructure and Video Competition Act of 2006 (AB 2987), signed into law last year by Gov. Arnold Schwarzenegger, allows cable providers to do so if they choose.

In El Dorado County, for example, county supervisors sold out their constituents’ interests by allowing Comcast to operate under an urban gridline model. That component of the franchise agreement between Comcast and the county requires service only be provided only in areas where a large number of homes exist as measured by linear road mile.

The problem is El Dorado County isn’t laid out that way. There are many curved roads that measured linearly are longer than relatively straight roads with too few homes to meet the minimum under the franchise agreement. They connect neighborhoods that might otherwise qualify for service since they have same approximate density of homes as those situated along relatively straight thoroughfares.

Comcast could extend service to these cut off areas, but declines to make the investment necessary to reach them. It insists on sticking with an urban gridline model that’s inappropriate for a place like El Dorado County and only serves to perpetuate the many broadband black holes that exist there.

More wishful thinking from CPUC on AB 2987

The California Public Utilities Commission (CPUC) has issued what it says is the first statewide broadband franchise to a cable company, Cox Communications.

CPUC President Michael R. Peevey said the franchise allows Cox to serve four relatively small areas adjoining its existing service territory in the San Diego area, marking a rare occurrence of a cable company attempting to gain customers in a competing cable company’s territory.

Peevey predicts legislation (AB 2987) signed into law last year by Gov. Arnold Schwarzenegger that put the state in charge of cable franchises instead of local governments is likely to spur competition among broadband providers. “This is good news for consumers, who will have additional choices of providers not only for video service, but for the broadband and telephone services that typically are offered over the newly-constructed cable facilities,” Peevey said. “The Legislature’s goal was to foster video competition and broadband deployment, and that is exactly what we see beginning to happen.”

I’m not as sanguine as Peevey. The costs of moving into an existing provider’s service area with new infrastructure are quite high. Consequently, telcos and cable companies are concentrating on their existing service areas. They negotiated low build out requirements in AB 2987 that only require them to deploy broadband to less than half of their service areas by 2012. In addition, cable companies are free to operate under the terms of local government franchise agreements that were in effect when AB 2987 became law earlier this year. That allows them to stand pat and not offer service to areas that currently don’t have service — hardly paving the way for an expansion of broadband as trumpeted by the CPUC’s Peevey.

Emerging fault line of the digital divide: new vs. older neighborhoods

The outlines of a new fault line along America's digital divide separating broadband haves from broadband have nots is becoming more and more apparent.

The split is between older, established neighborhoods and newer subdivisions, the latter often governed by a homeowner association. Telcos and cable companies like these developments because they believe new homebuyers will purchase more profitable bundled services such as the so-called "triple play" package of voice, high speed Internet access, and video programming. They can also negotiate exclusive deals with the association that lock out other providers and assure a higher take rate.

This is leaving older neighborhoods currently without broadband with greatly dimished prospects for ever getting broadband as providers effectively redline these areas, concentrating instead on new developments. This is bound to produce a political backlash from homeowners in older neighborhoods who will increasingly turn to their local governments for a solution. That in turn will drive incentives for public-private parterships in which local governments provide public rights of way for the construction of open access broadband telecommunications networks.

Schwarzenegger questioned on how telemedicine funding will expand broadband access

California Gov. Arnold Schwarzenegger received some skeptical questioning from a broadband deprived area of the state at a telemedicine demonstration project held last week in Eureka.

A questioner asked how $200 million earmarked for telemedicine under Proposition 1D, the school construction bond approved by voters last November, would help expand broadband access in Humboldt County. The questioner pointed out the county lacks a University of California campus, implying none of that $200 million would go to expanding broadband in that Northern California county:

Q: In order for something like telemedicine to work effectively, Humboldt County has to have a reliable broadband system, which we do not. What will the broadband initiative do to help us achieve a reliable system? Is the state going to be providing funding for that, or is it essentially going to be removing road blocks, as they say, to allow businesses (Inaudible)

GOVERNOR: Well, both. First of all, with my executive order we eliminated road blocks that were there, because we want to go and build and facilitate every town, every village in California as quickly as possible. That is the idea. So it’s a combination with the private sector and the public sector. That’s why we put the 200 million dollars in there, so that when they start building and increasing the facilities, university facilities. We are saying lets not just build buildings, let us also bring in technology, the latest technology. And so that’s what the 200 million dollars is all for.

Q: But we don’t have a university (Inaudible)

GOVERNOR: No, no, but I mean so that the private sector will pick it up and then take it to the various different places. So thank you very much. Thank you, everyone, for being here. (Applause)

It bears watching closely how much of the $200 million Schwarzenegger says will ostensibly be granted to private sector telecom vendors results in greater broadband availability in Humboldt County and other areas of California mired on the dark side of the digital divide.

AT&T residential broadband on back burner?

Some observers including your blogger have questioned AT&T's commitment to the residential wire line market in the wake of the company's recent acquisition of BellSouth, giving Ma Bell a 100 percent stake in Cingular Wireless. Indeed, AT&T chief Ed Whitacre told The Wall Street Journal after the deal closed "We're about to become a company with wireless at its heart.'' That likely means investment in AT&T's wire line infrastructure has been bumped down to a lower priority.

A personal experience today reinforces that scenario. I walked by a Cingular store and noticed a sign in the window "AT&T/Yahoo High Speed Internet Sold Here." So I dropped in and asked the manager when it would be available in my neighborhood. He didn't have a clue and suggested I come back in a couple of days and talk to the "techie guy." I headed out the door before he could ask me if I was interested in a wireless phone.