The end of ACP put the kibosh on the business plans of ISPs working to tackle the urban digital divide. I’m aware of a several ISPs working to bring broadband to neighborhoods where the majority of customers qualified for the $30 ACP discount. These business plans only made sense because a chunk of the revenue was guaranteed by ACP.
While some say that ACP is not yet dead, at this point, it looks like it will take a miracle, or at least a powerful champion in DC, to reinstate something like the ACP. I’ve been brainstorming with communities about alternatives to ACP, and I’m starting to think that perhaps FWA cellular service is the next best alternative.
I’ve had access over this past year to large volumes of Ookla speed tests in different markets, and what I’ve seen is that FWA cellular carriers are successfully delivering speeds of 100 – 300 Mbps within a mile or two of a cell site. I’ve seen neighborhoods on the FCC map where Verizon is now claiming gigabit capability, but I haven’t seen any speed tests yet in those areas to see what that means in real life. However, wireless broadband speeds get a bit wonky in cities where small dead zones pop up in the shadow of hills or buildings that block the signal.
FWA cellular is often the most price-competitive broadband alternative now that ACP is gone. Prices of $50 and $60 per month for unlimited broadband are a lot more attractive that the prices of the big cable companies.
There are network issues with using FWA on any mass scale. Carriers aren’t talking about the network management side of FWA in any detail, but from various corporate announcements it seems like FWA is mostly intended to monetize excess bandwidth capacity at towers. That means that in any given neighborhood, there is some natural cap on the number of customers an FWA carrier is willing to serve to not harm normal cellphone traffic. While carriers don’t want to talk about it, there is a lot of evidence that the wireless broadband signal varies in strength and is not nearly as stable as landline broadband. FWA is not a great technical solution for dense MDU properties and is probably best used for single-family homes and small businesses.
Deploying FWA on a significant scale means making new investments. I can’t imagine that cellular carriers are interested in making investments in infrastructure and marketing costs to sell FWA broadband in low-income neighborhoods. Expanding an FWA network means constructing new cell sites, probably small cell sites, and involves getting fiber backbone to new sites.
But I can picture various kinds of partnerships between a City and cellular carriers that might work. One kind of partnership would be on the infrastructure side. I can picture a City or an ISP looking for a low-income broadband solution and willing to invest in small cell sites and fiber to feed them as part of bringing a more affordable broadband solution to selected neighborhoods.
I can also envision various partnerships on the customer/marketing side. For example, cellular carriers today are involved in numerous wholesale arrangements with companies that repackage and resell services on their network. I can envision a city or ISP willing to buy thousands of bulk FWA connections a month – and with a wholesale discount, they could offer lower prices to low-income homes. I have to think there are many variations of these themes and a slew of possible partnership arrangements.
This is all reliant on cellular carriers willing to enter into a discussion of partnerships. Such partnerships would be obviously good for low-income residents and could help to increase broadband adoption in low-income neighborhoods. This would be good for cities that will benefit by having more residents connected to broadband. This could also benefit the cellular carriers by bringing them new customers and revenues, with somebody else tackling the marketing effort on their behalf.
Thanks for pointing out the need in the urban areas – we’ve seen it in the larger cities in the Carolinas. While the cellular FWA solutions are a good option, don’t forget WISPs and Wi-Fi zones also fit into the mix. At Open Broadband we are working with Mecklenburg County NC on free public Wi-Fi in parks. It doesn’t require an ACP funding mechanism, but it does take commitment from a county/city and the ISP to support it.
I have a different take. The major players have been on a ‘wait for federal funds to expand’ playbook for decades. ACP was just federal funding, there was no special attention to low income areas or discounted services etc, it’s just chasing the next extremely cheap revenue for them.
Lower income areas are NOT unprofitable for an ISP. The costs to build there are not the struggle for a major player. The lack of competition there is that the other costs involved in permitting and politics is very difficult for small operators to deal with. Small operators need to chase top dollar *or* need to chase the easy build, often the latter.
The ‘government’ whatever that really means these days could open these areas up to competition by do federally supported internet exchanges or stubs to every government funded building with access to ISPs (of any size).
These low income areas would be covered with price competative services in no time flat. ACP is bad, not good. ACP makes for single vender markets just like most circumstances where the government picks a winner via first-come first-serve funding.