Speed Goals for FCC Grants

I literally grimaced when I first read about the 25/3 Mbps speed test that will likely be part of the new $20.4 billion grant program recently announced by the FCC. My first thought was that the 25/3 Mbps goal would provide an excuse for the FCC to give the grant money to the big telcos again. Those companies could then take another ten years to bring rural DSL up to the speeds they should have achieved on their own a decade ago. With the history of the FCC pandering to the big telcos I instantly feared this possibility.

But let’s assume that the upcoming grants will be available to all comers. Why would the FCC choose the 25/3 Mbps speed target? It’s a terrible goal for many reasons.

  • While this FCC will not admit it, 25/3 Mbps is already obsolete as the definition of adequate broadband. It’s been five years since 25/3 Mbps was adopted and households are using a lot more data than five years ago. It’s pretty easy to make the case that the definition of broadband today probably ought to be at least 50 Mbps download.
  • If the 25/3 Mbps speed is already outdated today, then it’s a lousy goal for a decade from now. This FCC should not repeat the same blunder as the last FCC did with the original CAF II program. They should set a forward-looking speed goal that reflects the likely speed requirements at the time the grant networks will be constructed. Any network engineer who tracks customer usage will tell you that the minimum speed requirement for eight years from now should be at least 100 Mbps.
  • The 25/3 Mbps just feels ‘puny’. I got the same letdown when I read that a new NASA goal is to put a man on the moon again. Considering the huge leaps we’ve made in technology since 1969, striving for a moon-landing again feels like a small national goal and a waste of our national resources – and so does setting a broadband speed goal of 25/3 Mbps.

One of the goals that Congress gave the FCC is to strive to bring rural broadband into parity with urban broadband. In setting a goal of 25/3 the FCC is ignoring the broadband trend in cities. The big cable companies have increased minimum download speeds for new customers to beteen 100 and 200 Mbps and have unilaterally increased speeds for existing customers. 25/3 Mbps is a DSL speed, and we see the biggest telcos finally starting to walk away from copper. Verizon has gotten out of the copper business in nearly 200 exchanges in the northeast. AT&T has been losing DSL customers and replacing them with fiber customers. It’s almost unthinkable that the FCC would establish a new forward-looking grant program and not expect broadband speeds any faster than DSL.

In my mind, the FCC betrayed rural communities when they adopted the 10/1 Mbps speed goal for CAF II. That told rural communities that they had to settle for second-rate broadband that was far slower than the rest of the country. From what I hear, most rural communities don’t even consider the CAF II upgrades as real broadband. Rural communities want fiber. They view anything slower than fiber as nothing more than a stepping-stone towards eventually getting fiber.

The FCC needs to listen to what rural America wants. If this giant new grant program will make rural communities wait for years to get 25/3 Mbps then rural America will largely ignore it. Communities will continue to plan for something better. Households might begrudgingly buy 25/3 broadband, but the people in rural America know that is not the same as broadband elsewhere and they will continue to clamor for the same broadband that they see in cities.

I hope the FCC understands this. Even if they allow technologies in these grants that can only deliver 25/3 Mbps, the FCC can still use the grant ranking process to favor faster broadband. If the grants grading process emphasizes speed, then the $20 billion could probably be used to bring fiber to 4 or 5 million rural homes. In my mind that would be the ideal use of these grants, because those homes would be brought to parity with the rest of the country. Those homes could be taken off of the FCC’s worry list and the universe of underserved homes would be significantly reduced. If the grants give money to anything less than fiber, the FCC will have to keep on dumping grant money into the same communities over and over until they finally finance fiber.

This blog is part of a series on Designing the Ideal Federal Broadband Grant Program.

The FCC’s 2018 Broadband Report

The FCC has released a draft the key findings from the 2018 Broadband Deployment Report that will be officially released to Congress this week. This report is usually interesting, and this year’s report includes a few big surprises.

The 25/3 Mbps Speed Benchmark. The FCC announced that it is keeping the 25/3 Mbps definition of broadband that was established by the former Tom Wheeler FCC. This is a surprise because all three Republican commissioners have been writing and making speeches that said that this benchmark is too high. Their positions on the topic garnered a lot of political pressure and it looks like, for now, that they are choosing to leave that benchmark alone. But as you will see below, they have still found a way to dilute the importance of the benchmark.

Mobile Broadband not a Substitute for Landline Broadband. There had also been a lot of discussion by the Republican commissioners to count a cellular broadband connection the same as a landline connection. They have been making the argument that many people are satisfied by a cellular connection and that functionally both kinds of broadband connection can functionally be substituted. They had suggested last year that a customer that uses either of the two kinds of broadband But the new report makes the positive statement that the two kinds of broadband are different and that there are ‘salient differences between the two technologies”.

Continuing to Track Fixed Broadband. Since cellular broadband is not a substitute for landline broadband the FCC concludes that is obligated to continue to track the deployment of landline broadband as it has done in the past. If tracking had been changed to show households that have access to either landline broadband cellular broadband, then almost everybody in the country would have been considered to have broadband.

The FCC is Meeting its Statutory Mandate to Promote Broadband. This is the zinger finding from the FCC. Reminiscent of George W. Bush’s comment after hurricane Katrina of “Brownie, you’re doing a heck of a job”, the FCC has patted itself on the back and concluded that it has already done enough to satisfy the Congressional mandate that everybody in America has access to broadband.

The FCC notes that it has taken sufficient steps to meet its regulatory mandate for improving broadband:

  • Has reduced regulatory barriers to the deployment of wireline and wireless broadband;
  • Created a Broadband Deployment Advisory Committee to make recommendations on how to better deploy broadband;
  • Instituted reforms to the high-cost universal service funds to ensure accountability;
  • Introduced a reverse auction to provide additional rural broadband funding;
  • Revised rules for special access to promote facility-based competition for business services.
  • Authorized new wireless spectrum for use for landline and satellite broadband;
  • Eliminated Title II regulation and returned to light-touch regulations.

I’m not going to pick apart all of the items on that list, and some of them, like releasing more spectrum are positive steps. However, even there this FCC seems to favor licensed spectrum for the large ISPs rather than more public bandwidth. It’s really hard to make the argument that reversing Title II regulation and network neutrality will improve broadband coverage in the country. The recommendations from the FCC’s BDAC sub-committees are nothing more than suggestions, and from what we’ve seen so far most of the recommendations from these groups are parroting the positions of the giant ISPs.

It’s too early to know if the CAF II reverse auction will prove beneficial. There is some speculation that these funds will largely be pocketed by the big cellular carriers as another subsidy to continue to replace rural copper with cellular service. This may just turn into more of the same disaster we’ve seen with the first CAF II subsidy for the big rural telcos.

When the numbers get released with the final report we’ll still see that more than 20 million Americans don’t have access to broadband. While many of these live in rural areas there are still huge pockets of unserved residents in urban areas as well.

It’s true that this FCC has been active in the last year and has made the decisions cited in this draft report. But it’s nearly impossible to see how they can conclude that America has the broadband they need and that they have satisfied the Congressional broadband mandate. I guess we’ll have to see if Congress takes exception with their declaration that the state of American broadband doesn’t need any more help.