Disasters and Regulation

Both Ajit Pai, the Chairman of the FCC and Governor Rick Scott of Florida have expressed frustration over the speed of recovery of communication in the Florida Panhandle following hurricane Michael. I don’t think anybody expects communications to be restored quickly in the neighborhood by the shore where even the houses are gone, and the frustration is more with lack of communications in areas that were damaged, but not totally devastated.

There are a number of issues to be considered when looking at the slow recovery – regulation, technology and the profitability of the telecom carriers.

The regulatory issues are pretty clear. Back when AT&T or some smaller independent telephone company would have served this area we would have seen the same sort of response from the telephone companies as we see today from the power companies. AT&T and other telcos from around the country would have mobilized swarms of technicians to replace fallen wires. The electronics vendors would have gone to extraordinary lengths to shuffle and direct all of their resources to the disaster areas.

We had plenty of hurricanes during the time when we had telephone monopolies and the telephone linemen were out working as furiously as the power companies to restore service. I remember from the time when I worked at Southwestern Bell that the company had disaster plans in place and routinely reviewed the plans with employees who might be activated during emergencies – the company made disaster a recovery an everyday part of operating the monopoly business.

But the days of monopoly are long past. The phone company is now far from a monopoly and probably only serves a small percentage of the customers in any given area. The big telcos have had huge layoffs over the years and don’t have the staffs that can swarm the area. I wouldn’t be surprised if they don’t even have disaster plans.

Cable companies are the closest thing we have to monopolies and I expect them to put wires back in a reasonable time after a bad storm – but there are many parts of the hurricane-struck area that aren’t served by a cable company. A cable company is still not likely to get the same swarm of technicians like we saw in the regulated telco days.

As we saw with hurricane Sandy, the telcos no longer rushes to fix the damage. After that storm Verizon decided that they weren’t going to fix the copper and used the storm as an opportunity to switch customers to all-wireless cellular broadband. That’s not a change that can be implemented quickly and we saw some of the areas after Sandy without telecom for months. I expect AT&T is going through the same thought process for much of the area from hurricane Michael and is not going to put back copper wires.

There are also technical issues to consider. I’m willing to bet that the primary cause of frustration is the slow recovery of the cellular towers. Unlike the telephone network there is little redundancy built into the cellular networks. When the towers, antennae and equipment huts around a tower are damaged there is no quick fix, and replacements need to be shipped in. Unlike the major coordinated disaster plans of the old Ma Bell, I doubt that the cellular carriers have react-immediately disaster recovery plans. That kind of planning costs money. The companies would need to hold dozens of cell sites in place as spares that were ready to be shipped out on a moment’s notice. That’s not profitable and there is no regulatory agency insisting that the cellular companies have such plans in place.

As the technology at the edge increases, the time needed for recover from a disaster increases. I remember that this was a concern for telcos when they first placed DSL cabinets in neighborhoods – they knew it would take a lot longer to recover from destroyed electronics compared to the days when the outside network was most just copper wires. The cellular networks are the same, and we are about to enter a time when 5G and other new technologies will place electronics deep into neighborhoods. As slow as the recovery might be for hurricane Michael, it’s going to be worse when we are relying on dispersed 5G electronics deep in the field – it takes longer to fix the electronics and the backhaul networks than it is to put wires back on poles.

The issue that nobody wants to talk about is that all of the big companies in the telecom market are now publicly traded companies that exist to maximize quarterly earnings. Having disaster plans in place costs money – and the big companies these days don’t spend anything extra that’s not mandatory. Call it lack of regulation or call it an emphasis on the profit motive, but the big ISPs and cellular companies have no motivation or incentive to make extraordinary efforts after a disaster. I doubt that the existing regulatory powers even give the FCC any authority to impose such rules – particular with broadband, since the FCC says they are no longer regulating it.

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