Regulation - What is it Good For?

The Dawson Internet Act of 2018

A few days ago I wrote that we are not likely to get any significant telecom legislation this year. That’s unfortunate because we really need a major new Act to update all of the regulatory rules concerning broadband, telephone and cable TV. That got me thinking what I might write into such an act if I was the author, so following are the highlights of the envisioned Dawson Internet Act of 2018 (it’s time we stop calling this the telecom industry):

Cable TV. It’s time to scrap all requirements that dictate cable tiers. Cable companies need to be able to offer whatever channels they think make economic sense, including offering a la carte channels, if that’s what the public wants. I’d also scrap the must-carry rules for major network stations. The retransmission costs for those channels are one of the primary culprits for rate increases and removing the requirement to carry channels will return cable companies to a position of fair bargaining for price since they could walk away from any local station that wants too much.

Telephone. Other than a few rules that govern customer privacy I’d totally scrap federal regulations for landline service. I’d eliminate the CLEC classification and deregulate traditional telephone and VoIP equally to put the products on a non-regulated level playing field. I think I would retain the historic monopoly service territories, although I’d have to give that a lot more thought.

Interconnection. I’d keep the mandate that network owners must continue to interconnect with other carriers. They can’t be allowed to shut out a competitor by refusing to give them access to the underlying backhaul networks. But since I would eliminate the CLEC status, the big network owners need to be required to interconnect with anybody who meets specified technical standards.

ETC Status. Today a company must become an Eligible Telecommunications Carrier in order to participate in Universal Service Funds or other federal funding programs. I’d eliminate this requirement because it’s nothing more than a paperwork barrier to market entry. The current rules also disallow certain types of providers, such as owners of open access networks, although customers almost universally prefer that operating model.

Broadband. The FCC needs to regulate broadband, even if they elect to regulate it lightly. Congress can mandate this and get rid of the nonsense of trying to make broadband fit under Title II and just explicitly give the FCC the authority and obligation to regulate it.

Network Neutrality. I would make network neutrality the centerpiece of broadband regulation. The most important aspect of network neutrality is prohibiting paid prioritization – because once the ISPs start doing that all of the nightmare scenarios of a broken Internet emerge.

Spectrum. I think the FCC is already on a good path to free up spectrum for broadband. But I think they are missing the boat by not providing more spectrum for public access. One only has to look at the huge economic boom created by WiFi to see that giving all spectrum to big monopolies is not the best answer. I’d also make a firmer use-it-or-lose it rule for rural spectrum. A huge amount of spectrum sits unused in rural America but is still under control of the big carriers who purchased large-area licenses. Finally, rather than turn spectrum auction proceeds over the US Treasury I’d redirect these revenues towards meeting universal service goals.

Universal Service. I’d maintain the requirement that the FCC monitor broadband connectivity and require them to try to find solutions for areas without good broadband. I’d also prohibit them from funding any broadband programs like CAF II that support technologies that are slower than the federal definition of broadband. I’d also mandate an ongoing process for defining the official speed of broadband.

Privacy. I like what I’m reading about the European Union privacy rules. They are allowing ISPs and others to monitor and track customers only with customer consent. That will allow people who care about privacy to maintain it while allowing others who choose to sacrifice privacy for services to allow tracking. The penalties for violating customer privacy must be economically severe.

Municipal Broadband. I’d eliminate all barriers to municipal competition. Local communities ought to be able to decide themselves if they want to tackle the risk of building broadband. This is particularly needed in rural America where, in many cases, the local government might be the only one willing to tackle funding a network.

Access to Poles, Ducts and Dark Fiber. I’d make these assets available to anybody that can meet technical standards to use them. I’ve still not decided how I feel about federal one-touch rules, but I’d have the FCC institute a major rulemaking to get more facts on the issues involved.

I’m sure everybody in the industry has a different list than mine. I remember all of the discussions and negotiations leading up to the Telecommunications Act. That Act took  some political bravery since Congress was taking on the big telcos for the greater public good – and that Act did a fairly good job of promoting competition. But I don’t see this same courage in Washington today and most of the topics on my list are sadly not even being discussed.

Current News

FCC Approves New Spectrum for Public Use

On April 17 the FCC approved the use of a 150 MHz continuous band of spectrum that will be available for public use within the 3.5 MHz band, which they designated as Citizens Broadband Radio Service. This is not necessarily a replacement for traditional CB radio, but that is one of the possible uses of the spectrum.

The spectrum already has some existing users, mostly federal government use of radar and a few users who transmit to and from satellites. These existing users sit in the bands between 3550 and 3650 MHz. Additionally, this new offering will add a 50 MHz band up to 3700 MHz. There are also existing commercial users, including a handful of rural wireless ISPs using the higher end of the spectrum.

The FCC will be implementing a new way to share this spectrum among potential users. They want to implement a two-tiered approach to reduce interference with existing spectrum users. First, a radio that wants to use the spectrum must check with an FCC database to see if there is an existing user in their geographic neighborhood. Second, the radio must use what the FCC is calling ‘sensing technology’ that would first listen to be sure no one else is using the spectrum before transmitting. These two requirements differentiate this spectrum from other public bands used for WiFi where unlimited numbers of users are allowed to transmit simultaneously, and where interference is accepted.

The FCC hopes that this spectrum can support a wide variety of uses such as small cell deployment, fixed wireless broadband, and a category the FCC is calling general consumer use. The spectrum could be used to support CB-like radios, leading to the chosen name of the spectrum block. It’s anticipated that the spectrum could be used by wireless providers to extend LTE. There are already a few users that have been allowed to use the spectrum in rural markets to provide point-to-point data services.

The existing radar is mostly at naval bases near the coast. The FCC is not particularly worried about these bases being affected by the new users since they broadcast high-powered, strong signals. It’s likely the radar sites would overwhelm any attempted commercial use of the spectrum.

This announcement is part of the FCC’s response to widespread request for more public spectrum, and it furthers one of the goals set in the National Broadband Plan to have 500 MHz of spectrum available for wireless data. In many areas, the current public spectrum bands, such as those used for WiFi, are getting congested. At a time when there is a major proliferation of wireless devices and applications in the marketplace, the pressure is going to stay on the FCC to continue to find new slices of spectrum for public use.

There are several steps needed now that this order has been issued. First, somebody must be chosen to administer the geographic database of existing users. Verizon has already volunteered to take that role. Next, the FCC will be issuing a Further Notice of Proposed Rulemaking that will define the specific rules for using the spectrum. There is still a bit of a tug of war going on and the CTIA doesn’t want the spectrum to available to everybody, but the FCC seems somewhat determined on that point. Finally, vendors will need to get radios certified to meet the new requirements. Fortunately, many of them say that they now have radios that meet the expected final requirements.

This is a very interesting spectrum to consider for rural broadband deployment. The operating characteristics of the spectrum provide for long distance transmission and the deployment of significant bandwidth 5–8 miles from a transmitter. Further, it’s unlikely that in rural places there will be other users of the spectrum, particularly if using it for point-to-point connections to customers. Rule-compliant radios for the spectrum are expected to be affordable and this could be used to provide rural broadband links from 20–50 Mbps download. That is pretty good broadband for places that have no broadband alternatives today.

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