Tag: pole attachments

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Regulation - What is it Good For?

The BEAD Subsidy of Utilities

When ISPs are asked about the impediments they encounter for building new fiber networks, they almost always list pole issues at or near to the top of the list. Why are poles of such big concern?

Building aerial fiber means putting the fiber on poles. Most poles are owned by electric utilities, although some belong to telephone companies or municipalities. Invariably, some poles have to be replaced in order to add a new fiber line. This mostly occurs when there is not enough room on an existing pole to provide for the required safe distance between wires that are required by national safety codes. The common fix for this problem is to install a taller pole and move existing wires from the old pole to the new one – the process can be agonizingly slow since the pole owner has to coordinate with existing attachers. Worse is the expense, since the new attacher has to pay the full cost of replacing the pole and moving the old wires.

But poles often must be replaced because they are obsolete or in bad condition. The FCC recently issued new pole rules which designate poles that are out of safety compliance or that are already scheduled to be replaced as ‘red-flagged poles’.  Under the new rules, a new fiber attacher will not be responsible for the full cost of replacing a red-flagged pole. We’ll have to wait to see how the new rules play out in actual practice since pole owners are likely to argue vehemently about when to assign the red-flag designation.

Regardless of why poles have to be replaced, the BEAD grants are going to be used to replace huge numbers of poles. I don’t have any easy way to estimate the number of poles that will be replaced, but it wouldn’t be surprising if it is in the millions. It’s fairly normal for aerial construction to require the replacement of 5% to 10% of poles. In places where the poles are in bad shape, this can be a lot higher.

The cost of replacing poles is built into the construction costs of adding new aerial fiber. Since BEAD will pay up to 75% of the cost of fiber construction, that means BEAD will pay up to 75% of the cost of replacing poles.

That is a huge windfall for electric utilities. In far too many cases, the poles that will replaced by BEAD should have already been upgraded and replaced by the pole owners. Depending on the local conditions in different part of the country, poles typically are expected to last from 30 to 50 years. Unfortunately, it’s not unusual for utilities to keep poles far past the expected economic life.

Fiber providers have been yelling for years that the process is unfair. They are routinely being asked to replace poles that have held other wires for decades. During that time, the pole owner collected pole attachment fees – which should have more than covered the periodic replacement cost of the poles.

Regulators blew it a long time when they didn’t require pole owners to put pole attachment fees into a sinking fund that could only be used to repair poles after storm damage or eventually replace poles. But pole owners count pole attachment fees like any other revenue stream, and it’s quickly used for something else – and in many electric companies might even use the fees to pay dividends to shareholders.

Some states have recognized the pole issue as a big problem and used a solution that has me scratching my head. These states have taken some funding from CAREs or ARPA and created a pole replacement fund to replace the worst poles in the state. This makes some sense if bad poles are a major impediment to building fiber.

But you don’t have to think about this very hard to realize that a pole replacement fund is exactly the wrong economic incentive to give to pole owners. If I’m a pole owner and my State will fund pole replacement, I’m going to cut way back on the poles that I’ll voluntarily replace. I’d let the inventory of bad poles build up and then ask for more pole replacement money. To use common political vernacular – a pole replacement fund fosters welfare for electric companies.

The FCC had an opportunity in its recent pole order to take an important step, which was to require all pole owners to create a public inventory showing the age and condition of every pole. Such a database would make it easy to spot the pole owners who are not replacing poles as needed. Without this basic data, it’s incredibly hard for regulators to force pole owners to do the right thing.

The BEAD grants will bring a lot of broadband to places that need it. It’s just a shame that a lot of the funding will be used to replace the pole inventory of utilities that failed to invest in their own networks.

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Regulation - What is it Good For?

FCC Updates Pole Attachment Rules

After a three-year investigation, the FCC adopted changes to its pole attachment rules at the December 2023 monthly meeting. The new rules will go into effect soon after being published in the federal register. It’s worth noting that these rules don’t apply to everybody. These rules apply to poles owned by investor-owned utilities and telephone companies but not those owned by cooperatives and municipalities. The rules are also only effective in the 27 states that follow FCC pole jurisdiction. Other states with their own pole attachment rules are free to adopt or ignore these changes.

Following are the most notable changes that are included in the new order:

  • The FCC is creating a Rapid Response Process to expedite pole attachment disputes. In the states under FCC pole jurisdiction, disagreements over the interpretation or implementation of the rules go to the FCC. Fiber builders have complained that the process takes too long and kills construction projects. This process promises to judge quickly whether the dispute belongs at the FCC and if it is affecting the deployment of broadband in unserved areas. The dispute will either be taken to arbitration or handed to an FCC Administrative Lw Judge to handle in an expedited minitrial.
  • The FCC wants to make the pole attachment process more transparent. Pole owners will have ten business days to provide any reports or information about the conditions of its poles to a potential applicant. This would include any internal pole inspection reports, inventories, or other information that describes the condition of poles.

The ideal information would be a GIS inventory that shows details like pole heights, pole age, the number of other attachers currently using each pole, and any existing pole loading studies. This kind of data can greatly speed up the process of determining if somebody wants to use poles. For example, somebody trying to plot a fiber path through a community could use this data to choose a route that uses the most readily available poles. Unfortunately, the FCC is not requiring pole owners to create online or electronic databases of the information, but pole owners must provide all information they have about the conditions of poles.

  • In what will be the most hotly contested part of the order, the FCC is modifying the conditions under which a pole attacher has to pay for the full cost of replacing a pole when there is not enough room to add fiber. Under the current pole attachment rules, when a pole replacement is conducted for the benefit of a new attacher, then the new attacher must pick up the full cost.

That’s been a controversial rule, and fiber builders have accused pole attachers of forcing them to pay for poles that already violate safety requirements, or that have already been scheduled internally for upgrade. Attachers say that many pole owners have stopped upgrading poles in the hope that a new attacher will cover the cost of needed upgrades.

The new FCC rules define a new term, ‘red-flagged poles’ to define poles that are already out of safety compliance or that are already scheduled for upgrade or replacement. Under the new rules, a pole attacher would not be responsible for the cost of replacing red-flagged poles. The exception would be when the request from an attacher requires a red-flagged pole replacement to be taller – and then the attacher only pays for the incremental cost of the extra height on the replacement pole.

The FCC also issued a further notice for proposed rulemaking that seeks additional comments on a few other issues. One issue is to consider if utilities can put a size limit on the number of poles that an attacher can apply for. The FCC also wants more comments on whether it should give more leeway to attachers to tackle the work directly when pole attachers don’t meet attachment due dates. Finally, the FCC wants to explore the situation where a pole owner requires the use of a specific contractor to do the work and that contractor is not available – a situation I imagine is common today.

Only time will tell if these new changes will make a practical difference. The new rules only apply to half of the country, and not to all pole owners. The construction process is already in trouble if a new attacher has to go to the FCC to break a logjam with a pole owner, and it’s debatable what expedited resolutions mean.

The FCC isn’t making pole owners compile good pole information, and the rule that they have to disclose internal data isn’t worth much for pole owners that don’t have a good inventory of poles – which is, unfortunately, a lot of them.

I envision a lot of fights over the classification of poles as being red-flagged. Everything in infrastructure is a matter of degree, and what is the precise line between declaring a pole to be out of compliance versus almost out of compliance – I’m sure folks who want to add fiber will quickly find out how pole owners interpret these new rules.

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Regulation - What is it Good For?

Reducing Construction Barriers

One of the most interesting sections of the BEAD NOFO requires that states must define how they are going to make it easier for grant recipients to implement broadband solutions. Specifically, the BEAD NOFO requires states to try to “reduce costs and barriers to deployment, promote the use of existing infrastructure, promote and adopt dig-once policies, streamlined permitting processes and cost-effective access to poles, conduits, easements, and rights of way, including the imposition of reasonable access requirements.

These are all great ideas, but I have to wonder if whoever wrote that understands how hard it is for a state to change any of these policies. Certainly, there is no state broadband grant office with the power to effectuate any of these changes – is this section of the NOFO aimed at legislatures?

Some states have wrestled with these issues for many years. Consider pole attachment and issues related to streamlining the process of building fiber on poles. At my last count, twenty states have adopted their own state rules for the processes related to pole attachments.

I have been involved in several state proceedings looking at pole attachment issues, and this is not something that any state can change quickly. Changing any of the rules associated with pole attachments means opening a docket and soliciting ideas from the parties involved. Since most poles are owned by electric companies, any proceeding brings in the full lobbying power of the electric companies to not do anything rash. It’s also debatable if a state can implement a radical pole attachment rule that is too far out of bounds with FCC rules – since the FCC requires state rules to still adhere to many FCC standards.

For the FCC to consider changing pole attachment rules would take even longer. The FCC has tackled this a few times, and as you might imagine, looking at this issue from a national perspective is hard since pole attachment issues vary widely by locality. The biggest issue with changing pole attachment rules is the lobbying power of the other parties that use the pole – the telcos and cable companies. While they build a lot of fiber, they don’t want to see it be easier for their competition to build fiber.

It’s hard to imagine finding a way to universally streamline permitting in a state. It’s easy to understand why fiber builders don’t like the hodgepodge of permitting rules since every local jurisdiction has its own set of permitting rules and processes. But there is probably not a lot of interest by ISPs to let a State set universal permitting rules – in many states, the permitting rules for building along state highways are some of the most onerous, costly, and time-consuming. I also doubt that many states could declare jurisdiction over permitting since most state constitutions grant authority over local infrastructure to local governments.

The one change on the NTIA list that would have the most impact would be a requirement to make it easy to use existing infrastructure. There are existing fibers running through almost every rural county that is off-limits to anybody that wants to build last-mile fiber. It’s owned by telcos, cable companies, cellular carriers, and electric utilities – and all would fight tooth and nail against having a mandate to give access to their spare fibers. There is also a lot of fiber owned by state governments, local governments, and school boards. Interestingly, in most states, the legislatures have put these government-owned fibers off-limits for commercial purposes – all due to the lobbying effort of the existing ISPs. This requirement from the NTIA would be asking state legislatures to reverse the rules they put into place and have followed for decades.

Every list about infrastructure efficiency always suggests dig-once as a solution for reducing the cost of building fiber. This policy might have made a difference for the current grants if it was implemented twenty years ago, but implementing dig-once now would have very little impact on building BEAD grants if the requirement went into place tomorrow. Even if dig-once is implemented, it’s unlikely that a state policy will require the extra cost to add frequent access points along buried conduit – and without the access points, buried conduit is often nearly worthless for building last-mile fiber.

I completely understand the sentiment behind this requirement, but I think that state broadband offices are all going to tell the NTIA that these issues are not under their control. I find it a bit ironic that the NTIA wants states to take steps to make it easier and more affordable to build fiber while the NOFO layers on a lot of requirements that significantly inflate the cost of building a BEAD grant network.

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The Industry

Fiber Resource Shortages

The fiber industry is as busy as I have ever seen it, and it’s about to get even busier. The cellular carriers, particularly Verizon are actively building fiber to reach small cell sites. The cable companies are building a significant amount of fiber, particularly Altice which is upgrading to FTTP. The FCC is going to award $9 billion in 2020 for the 5G Fund grant program, much which will go for fiber to reach rural cell sites. The FCC will be awarding $16.4 billion in 2020 for RDOF grants to build rural broadband infrastructure. There are state broadband grant programs in many states providing funds to help with rural broadband projects. Independent telephone companies are still building rural fiber to meet their ACAM responsibilities. Electric coops all over the country are jumping into the fiber business. Finally, there are dozens of active fiber overbuilders building into new markets.

All of this fiber activity is going to mean a shortfall of industry resources of all kinds. I’ve already witnessed construction delays in projects this year due to resource shortages and I fear delays will increase in 2020 and beyond. Following is a list of the industry resources that I think will be in short demand or under stress, meaning that some fiber projects will have problems.

Construction Crews. I’ve worked with several projects this year that had problems finding enough construction crews. It’s not hard to imagine a shortfall of underground boring crews, aerial construction crews, or splicers as the industry gets busier. Maybe even more troubling will be a shortage of good fiber project managers. As we’ve seen in busy markets in the past, crew shortages are likely to result in higher construction labor rates.

Engineers. Almost every engineering company I know is already working at nearly full capacity. It won’t be surprising within a year to see engineering firms being selective about who they will work for.

Fiber and Fiber Components. I saw a few projects get slowed down this year due to backlogs of fiber cable and various components like handholes. I can recall worse shortages, but I suspect that we will soon not take the normal delivery intervals in the supply chain for granted.

Pole Attachment Processing. Many of the big pole owners, like commercial electric companies, say they are swamped with pole attachment requests. It will be interesting to see if One Touch Make Ready helps to relive the work pressure, or if it adds to the stress at utilities as they try to meet tighter time frames.

Rights-of-Way / Permits. I’ve already seen a few railroad crossings take longer than normal, with the railroads complaining that they are swamped with crossing requests. Expect the same thing for bridges and interstate underpasses. Expect the Department of Transportation in some states to be slow in issuing permits to build on state highways.

Grant Writers. You might assume that anybody can write a grant, but the specialists who write winning grant proposals for fiber projects are definitely a limited resource.

Consultants. Every consultant I know has a limited capacity in terms of the number of big projects like feasibility studies that they can tackle at the same time. I know I’m already being selective about taking on new work and I expect others are doing the same.

Loan Applications. After the stimulus broadband grants were awarded, the loan application backlog at the RUS grew to 18 months, meaning an applicant had to wait that long before the RUS even looked at an application. Expect the RUS backlogs and of other lenders to start growing again with the RDOF grant awards.

Banking. I can remember a few times during my career when banks like CoBank cut back on issuing new loans. All banks have a natural lending limit and I’m not sure that the normal industry banking institutions – the RUS, CoBank, and RTFC – can collectively float the dollar volume of new loans needed to support the RDOF program, let alone the many other broadband projects that are seeking funding.

All of these potential resource shortages portend problems for anybody building fiber. It’s hard to imagine a fiber project of any size that isn’t going to hit by at least a few of these delays. I’m sure I’ll hear of a few cases where these delays will be crippling. I think anybody planning to build fiber needs to anticipate delays and build them into their schedule because delays cost time, and time costs money.

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Regulation - What is it Good For?

Streamlining Regulations

Jonathan Spalter of USTelecom wrote a recent blog calling on Congress to update regulations for the telecom industry. USTelecom is a lobbying arm representing the largest telcos, but which also still surprisingly has a few small telco members. I found the tone of the blog interesting, in that somebody who didn’t know our industry would read the blog and think that the big telcos are suffering under crushing regulation.

Nothing could be further from the truth. We currently have an FCC that seems to be completely in the pocket of the big ISPs. The current FCC walked in the door with the immediate goal to kill net neutrality, and in the process decided to completely deregulate the broadband industry. The American public hasn’t really grasped yet that ISPs are now unfettered to endlessly raise broadband prices and to engage in network practices that benefit the carriers instead of customers. Deregulation of broadband has to be the biggest regulatory giveaway in the history of the country.

Spalter goes on to praise the FCC for its recent order on poles that set extremely low rates for wireless pole connections and which lets wireless carriers place devices anywhere in the public rights-of-way. He says that order brought “fairness’ to the pole attachment process when in fact the order was massively unbalanced in favor of cellular companies and squashes any local input or authority over rights-of-ways – something that has always been a local prerogative. It’s ironic to see USTelecom praising fairness for pole attachments when their members have been vehemently trying to stop Google Fiber and others from gaining access to utility poles.

To be fair, Spalter isn’t completely wrong and there are regulations that are out of date. Our last major telecom legislation was in 1996, at a time when dial-up Internet access was spreading across the country. The FCC regulatory process relies on rules set by Congress, and since the FCC hasn’t acted since 1996, Spalter accuses Congress of having “a reckless abdication of government responsibility”.

I find it amusing that the number one regulation that USTelecom most dislikes is the requirement for the big telcos make their copper wires available to other carriers. That requirement of the Telecommunications Act of 1996 was probably the most important factor in encouraging other companies to compete against the monopoly telephone companies. In the years immediately after the 1996 Act, competitors ordered millions of wholesale unbundled network elements on the telco copper networks.

There are still competitors that using the telco copper to provide far better broadband than the telcos are willing to do, so we need to keep these regulations as long as copper remains hanging on poles. I would also venture a guess that the telcos are making more money selling this copper to the competitors than they would make if the competitors went away – the public is walking away from telco DSL in droves.

I find it curious that the telcos keep harping on this issue. In terms of the total telco market the sale of unbundled elements is a mere blip on the telco books. This is the equivalent to a whale complaining about a single barnacle on his belly. But the big telcos never miss an opportunty to harp about the issue and have been working hard to eliminate sale of copper to competitors since the passage of the 1996 Act. This is not a real issue for the telcos – they just have never gotten over the fact that they lost a regulatory battle in 1996 and they are still throwing a hissy fit over that loss.

The reality is that big telcos are less regulated than ever before. Most states have largely deregulated telephone service. The FCC completely obliterated broadband regulation. While there are still cable TV regulations, the big telcos like AT&T are bypassing those regulations by moving video online. The big telcos have already won the regulatory war.

There are always threats of new regulation – but the big telcos always lobby against new rules far in advance to weaken any new regulations. For example, they are currently supporting a watered-down set of privacy rules that won’t afford much protection of customer data. They have voiced support for a watered-down set of net neutrality rules that doesn’t obligate them to change their network practices.

It’s unseemly to see USTelecom railing against regulation after the telcos have already been so successful in shedding most regulations. I guess they want to strike while the iron is hot and are hoping to goad Congress and the FCC into finishing the job by killing all remaining regulation. The USTelcom blog is a repeat of the same song and dance they’ve been repeating since I’ve been in the industry – which boils down to, “regulation is bad”. I didn’t buy this story forty years ago and I still don’t buy it today.

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Regulation - What is it Good For?

Prices for Wireless Pole Attachments

The FCC’s advisory BDAC group looking at pole attachment issues gathered prices for wired and wireless pole attachments. Their goal was to understand the range of attachments prices and to see if the group could come up with a consensus pricing recommendation to the FCC. Wired pole attachments are the annual fee that the owner of a wired network (telco, cable company, fiber) pays for each place one of their wires connects to a pole. Wireless pole attachments are the fees charged for putting some kind of wireless transmitter on a pole.

There were no surprises for wired pole attachments. The group looked at 577 different attachments and found that the average price was $17.58 per year for each wired pole attachment while the median was $15.56. These are similar to the prices I see all over the country.

Wireless attachments varied a lot more. The BDAC group looked at 407 samples of wireless pole attachment prices from around the country and the average price was $505.56 while the median price was $56.60. For the median to be that low means that the sample was stacked with low readings.

That’s easy to understand if you look at wireless pole attachment rules around the country. Three states – Arizona, Indiana and North Carolina have capped the annual price of a wireless pole attachment at $50 per year, while Texas capped it at $20. Other states like Colorado, Delaware and Virginia cap rates at actual cost. For the median price to be that low means that just less than half of the of the 407 same prices were likely from this group of states. And this means that that no conclusions can be drawn from the results of the BDAC’s sampling – it was definitely not a random or representative sample – yet the BDAC group summarized the results as if it was, and even calculates a standard deviation.

Thirteen states have already acted to limit the cost for wireless attachments, mostly through legislation. Florida and Rhode Island have capped the cost of a wireless pole attachment at $150; Minnesota set the rate at $175 and Ohio set the maximum rate at $200. Kansas says the rate must be ‘competitively neutral’ and Iowa caps the rate at the FCC rate.

One of the biggest issues with arbitrarily setting wireless pole attachment rates is that the wireless devices being put onto poles vary by size and can use between 1 and 10 feet of pole space. Regulators have traditionally used the concept of allocating costs by the amount of usable space taken by a given connector, and in fact uses the term ‘pole real estate’ to describe the relationship between space used and price paid. Any attachment that uses more of the pole real estate should expect to pay more for the attachment – largely in a linear relationship.

The results of the sample might have been more valid has the group not included prices for places where the legislators have capped or limited rates. Also, the big wireless companies are part of the BDAC group and I have to suspect that they brought in the worst case examples they could find where they are paying the highest prices. This exercise proved nothing other than that the price for wireless connections are higher in states where the rates are not capped.

It’s not surprising, but the BDAC group was unable to secure a consensus on prices or pricing methodology for the FCC. Unsurprisingly the network operator – those who attach to poles – think rates should be cost based. Pole owners think rates ought to be market based.

There are, of course, many other factors to consider in setting pole attachment rates. In the case of wireless connections there are concerns about the safety of working near the wireless devices after storm damage. There are also significant concerns in cities about aesthetics.

The battle in setting these rates is still heating up. An additional fifteen states – AK, CA, CT, GA, HI, IL, ME, MO, NE, NM, PA, WA and WI – have considered pole attachment legislation that didn’t pass. There is the possibility of the FCC trying to set rates and there have been drafts of several bills in Congress that have considered the idea. Since this seems to be the primary focus of the wireless companies there will be a lot of lobbying on the issue.

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Regulation - What is it Good For?

Light Poles and 5G

There is a lot of regulatory activity right now concerning wireless providers adding small cell site and 5G electronic to poles. A few states have adopted legislation setting low prices for such connections and similar bills are moving through many state legislatures. There is discussion at the FCC for mandating nationwide rules on some of the issues, and one of the FCC’s BDAC advisory groups was created to look at these specific issues.

One topic I haven’t seen covered in any of these efforts is how to deal with light poles – that is poles that don’t carry wires. I think this is a germane issue for many reasons. There are many poles that have been built solely for the purpose of providing street lights and I don’t think these poles are automatically covered by any of these regulatory or legislative efforts.

I’ve recently looked again at the various pole attachment rules to see if I’m right. One of the primary laws affecting pole attachments was the Pole Attachment Act of 1978 that determined a price structure for pole attachments and that authorized the FCC to develop specific rules for pole make-ready which included in Section 224 of the FCC rules. The right for carriers to use poles was bolstered significantly by the Telecommunications Act of 1996 that granted carriers the ability to use the poles, conduits and rights-of-way of existing utilities. That act defined poles as structures that carry telecommunications wires.

In many cases light poles fall naturally into this definition. In my neighborhood the streetlights are placed at the top of existing utility poles that carry wires for the various utilities. Clearly such light poles are covered by the FCC rules. One has to wonder how useful these poles are for 5G since light fixtures occupy the coveted top space on the poles that wireless carriers want to use, but from a regulatory perspective such poles are covered.

There are a lot of light poles that don’t fit into the current regulatory regime. A lot of light poles have been erected in neighborhoods where the other utilities are buried. These poles are not designed to carry wires. They are connected to the buried power lines to provide electricity for the street lights, but otherwise have no connection to other utility wires. A similar class of poles are ornamental ones. The last neighborhood I lived in had street lights that looked like they came straight out of a Sherlock Holmes story – metal poles with a big light globe at the top.

I’ve read the FCC rules several times this week and I can’t see where poles that aren’t intended to carry wires fall under FCC jurisdiction. Such poles often can’t even easily accommodate pole connections and might be made out of metal or concrete.

Cities of all sizes have required utilities to bury wires. The regulatory question is if the FCC will try to claim jurisdiction over poles that were built in such neighborhoods to only support street lights? This would pull millions of light poles under FCC jurisdiction, something that shouldn’t be done without deliberation.

The 5G legislation I’ve seen doesn’t recognize these issues. Some of these laws grant carte blanc authority to wireless carriers to deploy 5G networks without regard to local oversight. This could results in 5G transmitters being added to ornamental poles. It might mean constructing new poles in neighborhoods where the other utilities are buried. It could even allow wireless carriers to string fiber between such new poles, even though other utilities are buried. 5G networks are also going to want an unobstructed line-of-sight to buildings and wireless carriers might use aggressive tree trimming to get the paths they want. Such deployments are going to be wildly unpopular to homeowners and local governments.

None of this is going to happen without a big fight. Current federal pole attachment rules derive from acts of Congress, and anything short of a new federal law on the issues can’t easily change what has been done in the past. It’s questionable if the FCC can preempt state and local laws concerning pole attachments without a new federal law since earlier legislation granted states to optionally claim jurisdiction over pole issues.

One thing that is clear to me is that any new laws need to carefully consider all of the issues. A law that just gives carte blanc authority for wireless carriers to do whatever they want to going to be widely unpopular and will eventually get huge pushback. Even the idea of expanding regulatory authority over standalone light poles would likely be challenged as a state versus federal issue, meaning big court fights. I’m seeing a mad regulatory rush to give wireless carriers the ability to deploy 5G, but there are numerous issues involved that demand careful deliberation if we want to do this right.

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Regulation - What is it Good For?

FCC BDAC on Competitive Access

Today I discuss the draft proposal from the FCC’s Broadband Deployment Advisory Committee (BDAC) sub-committee that is examining competitive access. This draft report to the FCC is not yet final, but it details the issues and discussions of the group and is likely close to the finished work product.

This sub-committee is tackling some of the hardest issues in the industry. The pole attachment process has been a costly roadblock to implementation of new networks since the Telecommunications Act of 1996 allowed access of competitors to poles, ducts and conduits. The report considers a number of different issues:

The FCC Complaint Timeline. The FCC currently has no rules that require the agency to respond to a complaint from a carrier having problems connecting to poles. This deters attachers from making complaints since there is no guarantee that the FCC will ever resolve a given problem. The subcommittee recommends that the FCC adopt a 180-day ‘shot-clock’ to require rulings on attachment issues. The sub-committee is also recommending that the FCC react within 180 days to complaints about attachment rates and fees. The group wants to stop pole owners from capturing some capital costs twice. They claim some pole owners capitalize the cost for pole make-ready, which is paid by new attachers, and then build these costs again into the base pole attachment fees.

One Touch Make Ready. The sub-committee looked in depth at make-ready costs – the costs of a new attacher to get onto a pole. They are making numerous recommendations:

  • They want a simplified one-touch pole attachment process that streamlines the application, permitting and make-ready process. They would like to see all attachers agree to use only one contractor to speed up the make-ready process. They are also asking that the various parties agree to one contractor that is allowed to work in the power space, which is needed for some wireless attachments. They want make-ready rules to be uniform across all jurisdictions.
  • They want to require that the pole owner and all existing atachers be present during the feasibility survey, rather than having to coordinate visits with each existing attacher.
  • They want to speed up the time lines for reviewing and amending attachment requests.
  • They want to strengthen the FCC’s rules for ‘self-help’ which allow work to proceed when existing attachers don’t respond to attachment requests.

Fees and Rates. The sub-committee does not want the FCC to create a new pole attachment rate for a broadband connection – something they fear might be considered due to removing Title II regulation of broadband. They want ‘broadband’ attachments to be the same rate as telecom or cable attachments.

Recommendations for Other Infrastructure. The sub-committee would like to see an infrastructure database that identifies the owners of common telecom infrastructure like poles, ducts, trenches, street lights, traffic lights, towers, water towers, bridges, etc. This should include public buildings that might be useful for placement of 5G infrastructure. Knowing such a database will be expensive they have suggested ways to fund the effort.

Jurisdictional Issues. They want to see processes that streamline the jurisdictional differences for projects that crosses multiple local jurisdictions.

Use of Subsidized Infrastructure. Currently infrastructure built to serve schools or rural health care facilities is restricted to those specific uses if subsidized by the E-rate or Healthcare Connect Fund. The sub-committee wants such facilities to also be usable for other commercial purposes.

It’s hard to guess how much traction some of these recommendations might get at the FCC. Some of the jurisdictional issues, as well as the creation of an attachment database probably require Congressional action to solve. And some of the biggest ISPs like AT&T are both pole owners and fiber builders and it’s hard to know where they will support issues that will help them but which will also make it easier for their competitors. It’s also worth noting that the FCC is under no obligation to respond to the BDAC process. However, this particular sub-committee has taken a logical approach to some of the biggest problems with attachments, and these proposals deserve a hearing.

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Regulation - What is it Good For?

A Further Muddying for Pole Attachments

The issue of putting fiber on poles just got a little more complicated. A U.S. District Court recently overturned a One Touch Make Ready law that had been passed in Nashville, Tennessee to enable easier access to poles by Google Fiber.

The Nashville Metro Council passed the One Touch ordinance last year, and the new law was immediately challenged by AT&T and Comcast, the two large incumbent providers in the area. The law suit is complicated because it looks at two sets of poles – the 20% of the poles in the market owned by AT&T and the 80% of poles owned by Nashville Electric Service (NES), a municipal electric provider.

For the AT&T poles the judge ruled that the law violated federal pole attachment rules. The Telecommunications Act of 1996 gave states the optional authority to regulate poles, but the State of Tennessee never took on that responsibility, so the poles in the state are still subject to FCC pole attachment rules. This differs from an earlier lawsuit in Louisville, Kentucky where that state had preempted FCC pole attachment rules. Here it seems pretty clear that the Metro Council doesn’t have the authority to override FCC rules.

The lawsuit also claimed that the ordinance was in violation of local rules. AT&T claimed that the city charter did not explicitly give the Metro Council the authority to set rules for the NEC poles. The court said that NES had the exclusive right by charter to regulate public rights-of-ways. The court said it agreed with the AT&T allegations but did not make a firm ruling since NES was not a named party in the lawsuit.

The Metro Council originally passed the One Touch ordinance because AT&T and other pole attachers like Comcast were slow-rolling Google Fiber requests to get onto poles. Even today, a few years later, there are thousands of outstanding requests by Google Fiber to get onto poles. The One Touch ordinance would have given Google Fiber the ability to attach to poles and to then handle the paperwork retroactively.

This suit got resolved at a time when the FCC is considering One Touch rules concerning wireless connections. The FCC is thinking about granting the same rights to wireless carriers that this ordinance would have given to Google Fiber and other fiber overbuilders. The FCC recognizes that pole attachments are perhaps the major impediment for the promised coming implementation of 5G networks.

Incumbent pole owners have been able to thwart fiber overbuilders for the last few decades. They can deploy numerous delaying tactics that still fit within the FCC pole attachment guidelines. It’s not clear if the contemplated FCC rules will also make it easier for fiber overbuilders – but my guess is that they won’t. This FCC is clearly favoring the big ISPs and wireless carriers – and so they are likely to grant the rules that the big companies want.

This potential dichotomy between the treatment of wireless attachers and fiber attachers is ironic, because 5G networks are going to require a lot of new fiber. The wireless companies are not going to be building all of the needed new fiber and are hoping for others to build for them. But if those fiber builders encounter the same resistance seen by Google Fiber, then One Touch rules for wireless transmitters will not alone solve the 5G deployment issues.

One of the most interesting aspect of the pole attachment issue is that Verizon and AT&T are two of the largest builders of fiber. These companies scream bloody murder when they encounter the kinds of delays in building fiber that AT&T is causing for Google Fiber in numerous markets around the country. But AT&T clearly wears two hats and they argue for easy pole attachments where they are building fiber and for maintaining barriers to other fiber overbuilders when they own the poles.

None of this is going to be easily solved without Congressional action. There are still going to be states that can preempt federal pole attachment rules if they so choose. And the FCC is going to find themselves unable to overcome the state/federal jurisdictional issue when they try to make a nationwide One Touch rule for 5G. Expect a lot more lawsuits before this gets resolved.

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Regulation - What is it Good For?

The Battle Over Small Cell Deployment

Governor Jerry Brown of California recently vetoed a bill, SB 649, that would have given wireless carriers cheap and easy access to poles. He said the bill was too much in the favor of the wireless companies and that a more balanced solution is needed.

This law highlights the legislative efforts of the cellular industry and the big telcos working to deploy 5G networks who want cheap and fast access to poles. There were similar pushes in many state legislative bodies this past year including in Texas, Florida and Washington. I think we can expect this to appear in many more state legislatures next year. This is obviously a big priority for the carriers who reportedly spent tens of millions of dollars lobbying for this in the recent legislative sessions.

It’s not hard to understand why the carriers want a legislative solution, because the alternative is the regulatory path. This is a complicated issue and the carriers know that if they try to get this through state regulatory commissions that it will take a long time and that regulators are likely to provide a balanced solution that the carriers don’t want.

There is one regulatory push on the issue and the FCC is considering it. The FCC voted in May to begin an investigation on the issues involved. One of the things they are examining are the regulatory impediments at the state and local levels that affect the issue. But the carriers know that the FCC path is a slow one. First, any FCC decision is likely to be challenged in court, a tactic that the carriers themselves often use to slow down the regulatory process. But there is also a big jurisdictional question, because today the states have the authority to override FCC rules concerning pole issues.

The issue is important because it’s at the heart of the hottest area of telecom growth in the deployment of mini-cell sites and the upcoming deployment of the various kinds of 5G. Not only do the carriers need to deploy millions of such connections to implement the networks they are promising to stockholders, but they also will have to be building a lot of new fiber to support the new wireless deployments.

It’s easy to sympathize with the carriers. I’ve herd the horror stories of it taking two years to get a wireless attachment approved in some cities, which is an obvious impediment to any sensible business plan deployment. But as is typical with these carriers, rather than asking for sensible rule changes that everybody can agree on they are promoting plans that are heavily lopsided in their favor. They want to deploy wireless devices using a method they are calling one-touch – which they interpret to mean installing devices on poles and telling the pole owner after it’s done. They also want these connections for dirt cheap. And they don’t want to have to be concerned with the safety issues involved in adding boxes and live electric connections into the mix of wires on existing poles.

The issue is interesting from the perspective of small CLECs and fiber overbuilders because small carriers have been yelling for years about the problems associated with getting access to poles – and nobody has been listening. In fact, one of the big proponents of the legislative process is AT&T, which is still fighting Google and others about getting access to AT&T poles. It’s not surprising to see that the proposed new laws favor wireless deployments without necessarily making it any easier for fiber overbuilders.

Since the carriers are throwing a lot of money at this it certainly seems likely that they will win this issue in some states. There are a number of states where the lobbying money of the big carriers has always gotten the carriers what they wanted. But there are plenty of states where this won’t pass, and so we are likely going to end up with a hodgepodge of rules, state by state, on the issue.

I’m not even sure where I stand on the issue. As a consumer I want to see advanced wireless technologies deployed. But as a homeowner I don’t necessarily want to see an ugly proliferation of big boxes on poles everywhere. And I certainly don’t want to see 120-foot poles deployed in my neighborhood and the trees decimated to accommodate line-of-sight wireless connections to homes. And as somebody who mostly works for smaller carriers I’m naturally biased against anything that benefits the big carriers over everybody else. I don’t know if there is a better indication about how complicated this is when somebody with my knowledge has mixed feelings about the issue.

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