How FCC Policies Hurt Communities

I was recently looking at one of the counties where the winner of the CAF II reverse auction was Viasat, a satellite broadband provider. There are many other rural counties with an identical outcome. As I thought about these counties, I came to realize that a series of FCC policies and decisions have hurt these counties in their search for better broadband. There is no single FCC action that hurt them, but a cascading series of individual decisions have made it harder for them to find a broadband solution.

The first FCC decision that created the current situation is when the current FCC declined to consider an increase in the definition of broadband from 25/3 Mbps. That definition was set in 2015 and there is ample record on file in FCC proceedings that 25/3 is already an obsolete definition of broadband.

The most recent evidence comes from OpenVault. The company just released its Broadband Industry Report for 4Q 2019 that shows the average subscribed speed in the US grew from 103 Mbps in 2018 to 128 Mbps in 2019. That result is largely being driven by the cable companies and the fiber providers that serve more than 2/3 of all of the broadband customers in the country. The FCC is stubbornly sticking to the 25/3 Mbps definition of broadband even as a large majority of households in the country are being given speeds greater than 100 Mbps.

The decision to stick to the outdated 25/3 Mbps then created a second problem for rural America when the outdated FCC speed definition is used to award federal grants. The FCC decided in the CAF II reverse auction grants that any technology that met the 25/3 Mbps speed was acceptable. The FCC boxed themselves in since they couldn’t set a higher speed threshold for grants without admitting that the 25/3 Mbps threshold is inadequate. That auction awarded funding for technologies that can’t deliver much more than 25 Mbps. What’s worse is that the winners don’t have to finish building new networks until 2025. When the FCC blessed the use of the 25/3 threshold in the reverse auction they also blessed that 25/3 Mbps broadband will still be adequate in 2025.

The next FCC decision that is hurting these specific counties is when the FCC decided to allow satellite broadband companies to bid for scarce federal broadband grant monies. The FCC probably thought they had no choice since the satellite providers can meet the 25/3 Mbps speed threshold. This was a dreadful decision. Satellite broadband is already available everywhere in the US, and a grant given to satellite broadband brings no new broadband option to a rural area and only pads the bottom line of the satellite companies – it doesn’t push rural broadband coverage forward by a millimeter.

Finally, the FCC recently rubbed salt in the wound by saying that areas that got a previous state or federal broadband grants won’t be eligible for the additional federal grants out of the upcoming $20.4 billion RDOF grant program. This means that a county where a broadband grant was given to satellite provider is ineligible for grant money to find a real broadband solution.

Such counties are possibly doomed to be stuck without a broadband solution due to this chain of decisions by the FCC. I’m sure that the FCC didn’t set out to hurt these rural counties – but their accumulated actions are doing just that. Each of the FCC decisions I described was made at different times, in reaction to different issues facing the FCC. Each new decision built on prior FCC decisions, but that culminated in counties with a real dilemma. Through no fault of their own, these counties are now saddled with satellite broadband and a prohibition against getting additional grant monies to fund an actual broadband solution.

A lot of this is due to the FCC not having a coherent rural broadband policy. Decisions are made ad hoc without enough deliberation to understand the consequences of decisions. At the heart of the problem is regulatory cowardice where the FCC is refusing to acknowledge that the country has moved far past the 25/3 Mbps broadband threshold. When 2/3 of the country can buy speeds in excess of 100 Mbps it’s inexcusable to award new grant monies for technologies that deliver speeds slower than that.

It’s obvious why the FCC won’t recognize a faster definition of broadband, say 100 Mbps. Such a decision would instantly classify millions of homes as not having adequate broadband. There is virtually no chance that current FCC will do the right thing – and so counties that fell through the regulatory cracks will have to find a broadband solution that doesn’t rely on the FCC.

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