And it shall always be so. I know that the FCC has to establish a definition of broadband to use in some of its programs, but the speeds required by households has been climbing since the introduction of the Internet and is expected to continue to climb into the future. Even if the FCC adopts a faster definition today of what is broadband, in five years we are likely to be back gain discussing how that new speed is too slow to be considered as broadband.
The Washington Post reported that there is an internal debate at the FCC of whether the new standard ought to be 10 Mbps or 25 Mbps. There is a very big difference between those two numbers in terms of what it means for the nation. Why does it matter what speeds the FCC defines as broadband? There are several major reasons:
Who has Broadband? The FCC currently reports that 94% of the US has access to broadband when it’s defined at 4 Mbps download. There are plenty who even dispute that number since the carriers self-report speeds and geographic areas where only a few people have a broadband product are deemed to have it everywhere. But if the speeds in increased, especially to as high as 25 Mbps, then large swaths of the US are no longer going to be considered to have broadband. The government is going to find this embarrassing, when in fact it would just be recognizing the reality of the marketplace.
You can’t operate a modern family on 4 Mbps. One video streaming session would use every bit of that bandwidth leaving no bandwidth for anything else. The fact is that the modern family wants to have multiple streaming videos simultaneously while also using the Internet for other purposes. And with the upcoming Internet of Things the demands for bandwidth from multiple devices in the home is going to require significantly more bandwidth.
Federal Grants and Loans. Federal grants and loans for broadband are only given to areas that are deemed as unserved or underserved. Underserved means areas that don’t have broadband that meets the federal definition.
Large amounts of federal money have been given out in recent years to build rural broadband facilities that barely met the federal definition of broadband at the time of the grants. For example, a significant amount of stimulus grants were awarded to last mile projects that built wireless networks that can’t come close to meeting a 25 Mbps download test. Further, money was awarded from the USF fund to telcos like Frontier to expand DSL that can’t come close to the speeds the government is now considering.
So all of those federal monies will have just been recently spent on broadband upgrades that were barely adequate even as they were being done. Those upgraded or new networks are already obsolete even before the ink barely dries on the grant paperwork.
Let’s Be Forward Looking. Perhaps the government needs to use a more forward-looking test instead of funding broadband projects that barely meet the minimum definition of broadband. Because every five years we are going to be back in this same place. Let’s say that they raise the standards now to only 10 Mbps. It would be a joke today to spend federal USF or RUS money to build a network that barely meets that new standard.
The major problem is that once the government subsidizes a rural network, it becomes exceedingly unlikely that anybody else will spend more money to compete against that network, even if the first network isn’t very good. The first network will have gotten all of the customers in an area, which is a major disincentive for anybody else to spend money there.
I know the feds think they are helping by handing out billions to build rural ‘broadband’ networks. But if those networks are built at slow speeds that become quickly obsolete then they have relegated the people in those areas to remain on the wrong side of the digital divide forever.
If the government raises the new minimum broadband definition to 10 Mbps or 25 Mbps, then they need to set a much higher forward-looking speed standard for networks that get federal funding assistance. If they don’t do that, then every one of those newly constructed networks will fall below the federal definition of broadband in five years when we go through this exercise again.