Light Reading

FCC: Are You Being Served?

Mari Silbey
7/2/2014
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Is your census block being served by an unsubsidized broadband provider? That's the question the FCC is putting to the test with the start of the Connect America Phase II challenge process.

The goal of the Connect America Fund is to provide $1.8 billion in ongoing annual financial support for organizations trying to extend broadband connectivity in high-cost areas. However, the Federal Communications Commission (FCC) doesn't want to subsidize efforts in regions that are already being well served by commercial network providers. As a result, the agency is relying on a map of census blocks deemed eligible for funding based on three criteria.

Eligible areas must be considered unserved by an unsubsidized competitor, meet the qualifications for designation as a high-cost region, and be located in a "price cap" territory where existing providers are already contending with network access lines that are price-regulated.

The challenge process only applies to the first funding criterion. Parties submitting challenges must file with the FCC by August 14.

The Connect America Fund is a hot-button issue because current broadband providers don't want to run up against competitors that have what they see as unfair financial advantages. As such, the FCC is trying to walk a fine line between extending broadband service and not stepping on the toes of existing cable and telecom operators.

Many broadband providers, meanwhile, have been aggressive about trying to keep competitors at bay, whether they receive government funding or not. These efforts include encouraging state-level legal restrictions on community-owned broadband services. Some legislators are fighting back against those restrictions. Most recently, several Democratic members of Congress sent a letter to FCC Chairman Tom Wheeler urging him to promote competition and allow communities to decide for themselves how to invest in local broadband infrastructure. (See Dems Urge FCC Action to Protect Muni Nets.)

For the Connect America Fund challenge process, the FCC is pointing citizens to its online challenge process guide. The agency will review all submissions at the end of the 45-day challenge period.

— Mari Silbey, special to Light Reading

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brookseven
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brookseven,
User Rank: Light Sabre
7/3/2014 | 10:24:47 AM
Re: Urban Renewal
Costs depend on the site and style of deployment.  It is impossible to create a single number, especially given that Unions are involved in some situations.

I am telling you (not giving you opinion) about what is being spoken about here in terms of regulation.  You can have any opinion that you want, but it is rural independent carriers that are subsidized.  You said in your first post that this was about urban deployment.  High Cost Loops is straight USAC.  Read the following link:

http://usac.org/hc/legacy/telecom-carriers/step01/hcl.aspx

seven

 
jabailo
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jabailo,
User Rank: Light Sabre
7/2/2014 | 11:24:34 PM
Re: Urban Renewal
You raise good arguments, but they are unquantified (like mine).

What exactly is the cost (per meter) of maintaining a fiber optical cable?

What is the cost of an LTE antenna/site designed for broadband access?

As I understand it, yes, you can put more users per cable/antenna -- but that doesn't mean each will get more speed and use.  These resources are like party lines.  Cramming the most per unit resource is the idea.

However, at some point, if the costs become so cheap and so easy to maintain, then it behooves them to put it everywhere.

 
brookseven
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brookseven,
User Rank: Light Sabre
7/2/2014 | 10:34:33 PM
Re: Urban Renewal
jabailo,

Then you clearly need to rethink a whole lot of things.

The longest loop that I had to deal with was 80 miles and served a single home.  The line had to be installed by the Carrier of Last Resort for free.  This is an extreme illustration to help you see what you are missing:

- The number of homes served per mile of construction is much lower in rural America.  You can run a multi-fiber cable and support 1,000s of homes from one cable run through the manhole covered installation.

- The support costs to manage those remote installations are very high.  Cable breaks and equipment problems mean long trips to fix things for a few subscribers.

- Imagine the cost of installing an LTE antenna for a single home.  Before you scoff, the least dense phone company that I was aware of was Valley Telephone which was 7500 subs in 6500 square miles.  

That is why those companies get a huge amount of support for their networks.  Which is the whole point about unsubsidized companies.  AT&T and Verizon have the vast bulk of their connections in what is considered to be low cost areas so are not subsidized.

This is not speculation by the way.  It is the way the regulatory framework is constructed.  The 3rd bit that you should not is the "Price Cap" verbage in the original article.  There are still some small Incumbent LECs that are "Rate of Return" carriers.

seven

 

 
jabailo
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jabailo,
User Rank: Light Sabre
7/2/2014 | 8:16:00 PM
Re: Urban Renewal
Let me suggest another form of "competition".

Big cities are political and econonmic entities.

They have expensive real estate, they have high paying jobs, and they sell themselves by presumably offering something that you cannot get in the suburbs or rural areas.

Fast forward to the 21st century.

Now I can get 1Gig of fiber on my 2 acre summer home in the mountains, while my co-workers are sweating it out in the heat, and not able to get a halfway decent signal because of the reflections of the apartments.

Sounds like someone might get a little worried about their...investments.

 
jabailo
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jabailo,
User Rank: Light Sabre
7/2/2014 | 8:13:39 PM
Re: Urban Renewal
It would seem to me that stringing a single fiber cable along the telephone poles along a rural route or sticking a single Wimax or LTE antenna on a farm plain would be a lot less costly than having to go run the same cable by going down into manholes or scotch taping a bunch of plane "reflectors" on the side of every building.

But that's just how I think.

 
kq4ym
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kq4ym,
User Rank: Light Sabre
7/2/2014 | 7:58:20 PM
Re: Urban Renewal
It could be argued by some that it should be ok to "step on the toes" of the big guys. In order to bring competition and presumably better service at reasonable cost to the rural areas, the government might just allow that competition that indeed would hurt the profits of the existing guys a little bit.
brookseven
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brookseven,
User Rank: Light Sabre
7/2/2014 | 7:37:38 PM
Re: Urban Renewal
Note the commentary in the 2nd paragraph particularly the words "high cost".  Read that as rural.  

Now read "unsubsidized" in the first paragraph as Verizon, AT&T and some of Centurylink. 

That should help your comprehension immensely.

 

seven
jabailo
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jabailo,
User Rank: Light Sabre
7/2/2014 | 12:11:40 PM
Urban Renewal
This sounds like the urban version of the rural broadband acts that were passed.  It's ironic because some of these rural areas, where there aren't even towns, now are getting Google speed optical fiber, and higher than average cable connectivity, thanks to the Government's push.

Meanwhile, there are areas in "high tech" cities like Seattle that get speeds barely considered broadband any more!    Over time it seems like any and all wired connectivity will become optical fiber.  And phone service will end up all being 5G.   But someone has to turn the first shovel...

 
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