We dug deep into the maundering of recent public pronouncements to uncover the outline of a national broadband policy. Accompanying these pass-the-buck proselytizations is a sesquipedalian plan to do nothing at all.

by Patricia Fusco ISP-Planet Managing Editor [November 7, 2001]

Nancy Victory, head of the National Telecommunications and Information Administration (NTIA), discussed U.S. broadband policy at an event hosted by the NARUC in Crystal City, Virginia.

As an arm of the Commerce Department, Victory stated that she would "love to be able to unveil the Administration's broadband policy today, but it remains a work in progress." Victory did however purport that "competition should be promoted using a technology neutral paradigm," allowing exceptions, of course, for rural and inner-city areas.

Without a national broadband policy, Internet service providers of all shapes and sizes are left to twist in the wind—each one wondering which direction makes the most sense for the future of its service portfolio or business model. If we interpret Victory's statements literally, the DoC contends that coaxial cable and copper lines are the same as satellite feeds and wireless links when it comes to broadband services in the U.S.—except, of course, for the dirt-poor parts of the country.

Wouldn't it be wonderful if Federal Communications Commission Chairman Michael Powell followed up Victory's speech with an outline of our national broadband policy?

He did … eventually. But Powell's discourse presented more questions than answers in the near-term of things. The first of which is—what is broadband?

Broadband defined
Powell said a clear, uniformly accepted definition of the term evades the FCC.

"Whatever broadband is, it's fast—the Commission has defined it as 200Kbs. I submit, however, that broadband is not a speed," Powell said. "It is a medium that offers a wide potential set of applications and uses. "I think broadband should be viewed holistically as a technical capability that can be matched to consumers' broad communication, entertainment, information, and commercial desires."

Huh?

Do you suppose Powell is referring to content or bandwidth or both? Let's let him answer in his own words.

"[Broadband] is, to my mind, (1) a digital architecture, (2) capable of carrying IP or other multi-layered protocols, (3) that has an 'always on' functionality, and (4) that is capable of scaling to greater capacity and functionality as uses evolve and bandwidth hungry applications emerge."

Okay. We can translate this—broadband is a non-analog communication system that is IP-friendly, always connected, and eternally scalable.

Eureka!

For Powell's FCC, broadband is a premise, not a practice—a theory, not a technology.

Egads, what a vexing muddle. How do you regulate conjecture?

Powell has some definitive answers for this question—with a question—how should we measure broadband deployment progress and success?

Availability is king
Powell repeated his oft-stated premise that "the key measure is availability of the service, not adoption rates. I emphasize availability, because there are many questions that remain as to what services consumers will value, and to what degree they will be willing to subscribe. I am hesitant to let adoption rates drive government responses, for a developing market needs the cues provided by consumer free choice."

In terms of availability, J.P. Morgan reports that 73 percent of households have cable modem service available and 45 percent have access to DSL. To Powell, availability is king. Combined, he estimates that almost 85 percent of U.S. households have the option of subscribing to broadband service of one kind or another.

The intriguing statistic is that only 12 percent of these households have chosen to use broadband services. But this is not a key metric for federal regulators. In Powell's book, consumer demand will come with rich content and must-have broadband applications. "Copyright issues are delaying the distribution of broadband intensive content, and hence, demand for broadband," Powell said.

ISPs will be surprised to learn that the FCC believes that Disney (the copyright holder)—not the local phone company—is preventing them from providing DSL service to their subscribers.

But it gets worse. Powell is claiming that broadband deployment is not a regulatory issue for the FCC to wrangle. If consumer demand needs to be given a boost, it's up to Congress to do so—according to Powell. He itemized the tools and solutions available to the federal government:

• Directly paying for build-out, by subsidizing consumers or providers.
• Indirectly paying, by offering tax incentives to either consumers or providers.
• The government can aggregate demand as a large purchaser itself to stimulate investment or facilitate building successful community-industry partnerships.
• Removing legal barriers.

Get back
Powell said he believes strongly that broadband should exist in a minimally regulated space because substantial investment is required to build broadband networks.

That's when it happened. Powell spelled out in no unequal terms our national broadband policy. Really, he did.

"We should limit regulatory costs and uncertainty. We should vigilantly guard against regulatory creep of existing models into broadband, in order to encourage investment," Powell said.

Powell's FCC will act as stewards to develop a minimally regulated broadband regime focusing their energies on demonstrable anticompetitive risks in provisioning. If Powell has it his way, cable and telecom carriers are about to be unleashed from their yoke of regulatory servitude.

What's this mean for the average ISP trying to make a buck off from broadband?

If your ISP doesn't have local loop access now, forget about it. You're not going to get it on terms that would do your business any good. Be patient and wait for the day when telecom companies need your ISP to distribute their broadband services.

If your ISP wants to be a part of the cable scene, change the channel. MSOs will come knocking on your door for distribution deals after DSL rivals their service offerings. In other words, be patient until the tides have turned and the fallout from heated competition settles.

In the meantime you could deploy a fixed wireless system and peddle your ISP's own brand of broadband services. Sure there's a learning curve stretching your wired knowledge to Wi-Fi technology, but slow and steady wins the race. As long as our national broadband policy is no policy at all, your ISP has got time on its side.

— End

 

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