Some 36 public workshops, 9 field hearings, and 31 public notices later, the FCC today finally unveiled their national broadband plan
(pdf). There's 376 pages of dense policy to dig through, so it's going to take some time to completely digest the plan. Legal experts and policy wonks will be poring over this one for weeks, given the FCC recommends some fairly dense changes to telecom mainstays like the Universal Service Fund (USF). Also keep in mind that this plan is preliminary, and will heavily mutate as it runs the lobbyist and political gauntlet. That said, here's our high and low points:
What's Promising About The Plan
• At least it's a plan -- kind of
: One good thing about our national broadband plan is that it is one. Almost. It's more like a pile of recommendations to Congress, or a plan for a plan. That may not sound like much, but for a country that has spent the last decade using bad data
to proudly proclaim we didn't have any broadband issues to fix
? It's a forward step. The plan punts to Congress on some of the tough issues, but it at least gives recommendations and establishes a framework.
• The FCC wants 4 Mbps to be broadband's baseline
: For years we've reported
how the FCC used fairly paltry definitions of broadband (256 kbps downstream, recently updated to 768 kbps) so that our national success on this front looked good. The FCC's plan now calls for broadband to be defined as "4 Mbps of actual download speed and 1 Mbps of actual upload speed" (page 135). Page 19 tries to argue that 95% of us already have access to those speeds, which brings us to...
• The agency makes collecting more hard data a priority
: On page 38 of the plan, the FCC proclaims that "the dearth of consistent, comprehensive and detailed price data makes it difficult to evaluate price competition." While the FCC tries to do so anyway -- it's clear the agency's decade-long disdain for hard science has come home to roost, and impacted the agency's plan draft. The plan calls for a complete overhaul of FCC data collection and public presentation. This is the first of many FCC proposals where the devil will be in the details
and the agency needs to stand up to major carriers to achieve the goal.
• The plan pushes for broadband advertising improvements
: While the plan's habit of citing transparency as a fix for competitive issues is disingenuous, the plan makes it clear the FCC would like to impose requirements that improve the accuracy of broadband advertising. The FCC is eager to eliminate the use of the dreaded "up to" speed descriptor, replacing it potentially with a "broadband nutritional label" (see FCC example, left and page 46 of the plan) that could potentially advertise both the maximum and average provisioned rate.
• The plan finally begins revamping the Universal Service Fund
: For years even the government's own General Accounting Office has complained
that the Universal Service Fund was collecting billions in taxpayer dollars but the FCC wasn't doing a very good job managing the fund. While the plan's USF reform is a complicated tangle of policy revision, the primary goal is to refocus $16 billion in USF funds over the next ten years away from legacy voice service and toward broadband. By 2020, voice-only networks (assuming there are any) won't be eligible for USF funds.
•The FCC wants wireless broadband to be a priority
: The plan clearly pins a lot of hope on 4G wireless broadband services as a cornerstone of future competition, and Chapter 5 (starting on page 73) is entirely dedicated to spectrum. The plan's goal is to get 500 megahertz of spectrum into the hands of 4G providers, of which 300 megahertz (between 225 MHz and 3.7 GHz) is to be made newly available for mobile use within five years. There's an ocean of details involved in the FCC's agenda, and the devil will be in the end-game details and whether broadcasters want to give up some unused spectrum (hint: they don't).
•The FCC wants more competition in the set top box market
: The FCC is pretty clearly annoyed with the industry's (and their own) failure with CableCARDs
and starting on page 49 explains how the agency is going to push hard to end proprietary conditional access systems "on or before" December 31, 2012. In other words: they want more consumer choice in broadband-powered set tops and home gateways that can access the Internet without carrier restrictions. Again, the devil will be in the details and whether TV operators want consumers to have access to their choice of completely open set tops (hint: they don't).
What's Troubling About The Plan
• USF reform could actually increase the cost of broadband and phone service
: While the FCC repeatedly states their goal for the plan is to deliver "affordable" broadband to Americans by 2020, the proposals could actually raise your broadband costs. The plan imposes a new "Connections" fee as part of an overhaul of the USF that will be used for deploying broadband to under-served markets. While good for under-served markets, that means a higher bill for you. The plan annoyingly omits how much this fee could be, but once the details are hashed out, it could raise your monthly broadband bill from anywhere from $1 to $5 a month.
In addition, the FCC recommends to Congress that they allow increases in the FCC subscriber line charge, which is money that goes right back to carriers. The plan is vague when it comes to hard numbers per subscriber here as well, but industry analyst Dave Burstein tells us his his initial analysis suggests the plan could actually wind up with American families paying $5-$10 more a month when it's all said and done. Yes, maybe this money goes back to the public, but given the FCC history on this front, maybe this money goes into AT&T's pocket. Of course also tied directly to high consumer prices is the fact that...
• Again, the plan fails to tackle a lack of competition
: On page 30 of the plan, the FCC proudly proclaims that the plan "contains more than 40 recommendations that directly spur competition," which makes the fact that the plan doesn't really address competition all the more obnoxious. These recommendations include such things as child safety, digital education efforts, and identity theft countermeasures. While all noble, they don't address the problem that large swath of U.S. markets suffer from high prices and slower speeds created by monopoly or duopoly markets.
The agency's own study
suggested that open access policies could be one possible solution to the nation's duopoly logjam. However, the agency has made it very clear
they have no intention of upsetting incumbent carriers -- many of which not only wield incredibly influence over Congress, but have also been fused into our national security infrastructure
. With absolutely no hyperbole intended, many of these carriers now wield far more legislative and legal power than the FCC itself.
"The dearth of consistent, comprehensive and detailed price data makes it difficult to evaluate price competition."
-FCC's National Broadband Plan
• The plan is heavy on the showmanship
: Many of the recommendations look good and are politically easy to accomplish -- but lack substance. As we've already noted
, the agency's goal of bringing "affordable" 100 Mbps to 100 million U.S. homes sounds good and is getting played up by the press. But when you consider that cable broadband alone
already passes 125 million homes -- the majority of which will be upgraded to faster DOCSIS 3.0 service within 5 years without FCC intervention -- this supposed "cornerstone" of the plan rings hollow. Did we mention "affordable" is left undefined?
The agency also proclaims that they want to see broadband adoption improve from 65% to 90% by 2020, something that could happen organically whether the FCC is involved or not. A few million thrown at digital literacy campaigns is the supposed answer -- though several of these efforts involve using taxpayer dollars to fund cable industry advertising campaigns
. There simply is a vast mountain of policy in this plan that is, for lack of a more scientific term, empty, feel-good crap, while issues like unethical billing practices
go completely unaddressed.
• The plan fails to disrupt the status quo
: We've been covering this sector for a decade, and there is absolutely no limit to the number of think tanks, fake consumer groups, policy wonks and PR flacks employed by major carriers to help shape (and distort) public opinion, press coverage, and DC policy. Both before and after the plan's announcement these chorus of voices for hire were collectively, notably, uncritical. Why is that a problem? Any plan worth the 376 pages it's printed on should address competition, which could hurt revenues, which would anger the carriers, who would then fire up this "sound wall" of opinion for hire.
Granted, some carriers may not like the various rulemaking processes that emerge from this initial plan, but by and large the plan itself (after two full read throughs) does absolutely nothing to rattle the duopoly status quo in the broadband sector, and carrier silence proves it. That indicates a lack of conviction, courage and vision by plan architect Blair Levin. It also indicates that politics and carrier loyalty drove the national broadband plan's structure as much as science. That doesn't mean that things can't be accomplished as we head into the real rulemaking battles to come, but...
•The plan completely fails to address money in politics as a primary reason for our failures
: The primary problems the plan faces actually aren't technical, given we're a nation packed with oodles of fiber, bright network engineers and significant wealth. The plan's primary obstacle is the influence the nation's wealthiest carriers (AT&T, Verizon, Comcast) have on the nation's political and legal infrastructure. We've seen an endless parade of well-intentioned sector reforms scuttled by carrier lobbyists. It remains unlikely that true change in the broadband (or any other sector, for that matter) can be implemented until the problem of undue corporate influence on policy has been addressed first.
What Happens Now
As we noted at the start, the FCC's new national broadband plan is more of a "plan of a plan," and implementation in the face of lobbyist pressure will be key. As plan architect Blair Levin stated this morning at the plan's introduction, the "plan is in beta, and always will be." The FCC has simply set the table for a significant number of policy discussions and rule making procedures, that may (or may not) end in substantive improvements in the sector.