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Re-Defining Broadband

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The FCC recently asked for comments about how broadband should be defined. There was a marked difference between those who put community needs first and those who put profits first. Companies like AT&T and Comcast were quick to argue that the FCC should not change the definition of broadband for reasons ranging from too much paperwork to the suggestion that rural people have no need for VoIP. The honest approach would have been for these companies to say they do not want a higher definition because it will change their business plans, likely requiring them to invest in better networks for communities, and that will hurt their short term profits. On the other side were groups that argued for a more robust definition of broadband - something considerably less ambitious than our international peers but an improvement over the current FCC definition. NATOA's comments [pdf] focused on issues like the need for measurements based on actual speeds rather than advertised and symmetrical connections (or at least "robust upstream speeds to facilitate interactivity" - which we think captures the importance of symmetric connections without getting lost in debates about absolutely symmetric connections).
The key metric for broadband should be the applications and needs that drive consumer requirements and choices. In this way, broadband should be understood as a connection that is sufficient in speed and capacity such that it does not limit a user’s required application.
Their magic broadband number is a reasonable and doable 10Mbps symmetric connection for residential and small businesses as well as a 1Gbps level for enterprise users. Importantly, they note that a single broadband connection supports far more than a single computer or use - these connections are shared, often among many wired and wireless devices. Compare these comments to those of the NCTA [pdf] (lobbying organization for cable companies) that argue broadband is nothing more than an "always on" connection regardless of the speeds or user experience. This is how they justify maintaining the international laughingstock definition of 768kbps/200kbps.

Statewide Video Franchising: Bad for Communities

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Folks who are mostly interested in broadband are probably unfamiliar with video franchising laws. Many people still apparently believe that cable companies are able to get exclusive franchises from the city (granting them a monopoly on providing cable television). However, that is not true and has not been true for many years. Most cable companies still have a de facto monopoly because it is extremely difficult to overbuild an existing cable company - the incumbent has most of the advantages and building a citywide network is extremely expensive. This is not a naturally competitive market; it is actually a natural monopoly. However, most people want a choice in providers (something that goes beyond a single cable company and a satellite option or two depending on whether you rent/own and your geographic location. In talking with many local officials and the National Association of Telecommunications Officers and Advisers (NATOA), it seems that almost every local government wants more competition in its community too. This is where telephone and cable company lobbyists have stepped in - more successfully at the state level than at the federal level. They have convinced legislators that the barrier to more competition is local authority over the franchise (the rules a company agrees to in return for the right to use the community's Right-of-Way in deploying their network). These rules include red-line prohibition (you cannot refuse to serve poor neighborhoods), an affordable "basic" tier of service, local public access channels, broadband connections at public buildings, etc. Some states have listened to the lobbyists and enacted statewide franchising - where local communities are stripped of the authority to manage their Right-of-Way and companies can offer video services anywhere in the state by getting a state franchise from the state government. Every year, we gather more data that this practice has hurt communities, raised prices, and barely spurred any competition. Most of the competition it is credited with spurring came from Verizon's FiOS deployments, which would have occurred regardless of state-wide franchise enactment. This touches directly on broadband because the statewide franchises often give greater power to companies like Verizon to cherry-pick who gets next generation broadband.

WashPo: Headline Wrong, Story Mostly Correct

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Cecilia Kang, telecom writer for the Washington Post, recently looked into why major carriers are not applying to the broadband stimulus program. The implication of the title - "Major Carriers Shun Broadband Stimulus: Funds would come with tighter rules" is because of the rules. I'm sure she didn't write the title or sub, that usually goes to the editor. But it would appear whoever wrote the title did not read the piece because she shows that the rules are a minor factor at best. Unfortunately, Kang also makes a significant error in not appearing to have read the stimulus legislation because she seems surprised that major carriers are not interested in the stimulus. The stimulus was emphatically not targeted at those carriers. As I detailed here previously, Congress intended the stimulus to boost public and nonprofit investments though private carriers could apply if they met a public interest requirement - an intention that NTIA ignored when making the rules. Reading the legislation, it was never aimed at the large carriers so their lack of interest is no surprise -- unless you are Robert Atkinson of the Information Technology and Innovation Foundation...
"If you want to get broadband out, you have to do it with [those] who brought you to the dance in the first place, and in this case it is the incumbent cable and telephone carriers who have 85 percent of lines in the country," said Robert Atkinson, president of the Information Technology and Innovation Foundation, a Washington tech policy think tank.
Mr. Atkinson appears to educate himself solely with the press releases and reports of incumbent-financed think tanks. He has systematically ignored the potential for publicly owned networks - as we have shown, these networks are some of the fastest and most affordable networks in the country. Instead, he opines about the need for incumbents to build more of their super slow DSL networks - as though that is what the country needs to remain competitive in the 21st century.

Roundup: Chattanooga, Seattle, Portland, and More

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A couple of short interesting stories this week:

  • The Chattanoogan.com published a "Declaration of Independence from Comcast", written by a "fi-oneer" or person who is testing the new publicly owned FTTH services.

    Unsurprisingly, there are some glitches this early in the process, but the fi-oneer seems pretty happy with it overall:

    The television is fantastic; we have a multitude of channels, both high def and non high def; local, 'cable,' sports, movies, etc. Contracts are still being completed with a couple of providers, so we are missing my favorite, HGTV. I have been told that it will be coming in less that two weeks.

    Although as with any new product there are occasional glitches, but we have only had a few, minor not major ones, at that. The picture might freeze for a few seconds, or pixilate for a few seconds. There are some things you need to learn about the remote control.

    Interestingly, early problems can actually help community networks. In Burlington, Vermont, early problems allowed the publicly owned network to demonstrate how good its customer service was compared to the incumbents and gained a better reputation.

  • More news out of Seattle - following up on our recent story noting Reclaim the Media's push for public broadband in Seattle, Seattle radio station KUOW's program "The Conversation" had some guests discussing the existing network in Tacoma and a potential network for Seattle. Follow that link to listen in, the relevant portion runs from 14 minutes to 21 minutes (a total of 7 minutes).

  • Karl Bode at DSL Reports slams a recent report by incumbent-flack group Discovery Institute that concludes government regulation of broadband is unnecessary. Bode's response is worth reading, here is an excerpt:

Nation's Largest Citywide FTTH Network to be Completed Next Year

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Chattanooga, Tennessee is predicting it will offer FTTH in its entire service area by next year. The public power company has used fiber-optics in the past to manage its electrical operations and has been planning to offer a full FTTH network for awhile.
"There are two primary components to building this system. One component is taking longer than we thought and the other is happening much faster than we anticipated", said Harold DePriest, President and CEO. "The end result is that services will be available to the entire cities of Chattanooga, East Ridge and Red Bank by summer of 2010." DePriest says once in place, EPB's fiber optic network will be the largest of its kind in the country.
However, Chattanooga has suffered the same problem that has plagued other publicly owned broadband projects around the country: incumbent telco and cableco lawyers. Comcast has sued Chattanooga in multiple courts in an attempt to limit competition (see here, here, here, and here for a few examples). As with these cases across the country (from Monticello, MN to Bristol, VA, to Lafayette, LA), the incumbents have lost the cases but successfully slowed the build-out, which hurts the community while padding company profits for an extra couple of years. The network will offer symmetrical speeds of 10-50Mbps while keeping costs lower than the standard prices in the market.

Community Broadband - High Capacity, Low Cost

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To celebrate the launching of MuniNetworks.org, we wanted to highlight some of the best broadband available in the United States. If you were looking for the best citywide broadband networks available in the United States, you would almost definitely find publicly owned networks. We just collected some data on top-performing networks in the U.S. Though Comcast and Verizon have received a lot of attention for their investments in higher capacity networks, they still do not compare to some of the best community full fiber-to-the-home networks. In comparing some of the fastest publicly owned broadband networks to some of the fastest national private sector networks, we found that the publicly owned networks offer more value per dollar. Update: A few weeks after this was published, Verizon upped its speeds and prices for several of the tiers. download.png upload.png Perhaps the most interesting aspect of the data are the baseline speeds available in Wilson North Carolina and Lafayette Louisiana. Lafayette offers a symmetrical 10Mbps connection for $28.95/month whereas Wilson charges $34.95. I can only imagine how these networks have made their businesses more competitive while cutting telecom budgets for the schools and cities. Imagine being a business in Lafayette with a 50Mbps symmetrical connection when your competition is renting a T-1 at 1.5Mbps for $500/month. 30x the speed at 1/10th the cost. That is a competitive advantage. In Utah, if Comcast has upgraded to DOCSIS 3 in that area, they'll be charging $140/month for a 50/10 connection when those in the UTOPIA footprint have access to a 100/100 connection for $147. At least some communities across the U.S. are still competitive with the rest of the world when it comes to Mbps at affordable prices. There is still hope.

Services Comparison

Community broadband networks offer some the highest capacity connections at the lowest costs. Many of these communities, before building their networks, were dependent on 1.5 Mbps connections that cost hundreds of dollars, or less reliable DSL and cable networks. The community broadband networks below are full FTTH networks, so the advertised speeds are the experienced speeds -- unlike typical cable advertised speeds, which users pay for but rarely experience due to congestion on the shared connection. In comparing some of the fastest publicly owned broadband networks to some of the fastest national private sector networks, we found that the publicly owned networks offer more value per dollar. Update: A few weeks after this was published, Verizon upped its speeds and prices for several of the tiers. download.png upload.png The data we used is below. We thought about comparing also Qwest's "[no-glossary]Fiber-Optic Fast[/no-glossary]" speeds, but their fastest upload speeds are below 1 Mbps, which makes them too pokey for the above networks.

Community Broadband Networks: The Best of the Best

Note: Speeds are expressed as Mbps Down/Up. Each network has distinct offering for each tier.
Tier 1 Tier 2 Tier 3 Tier 4
City State Speed Price Speed Price Speed Price Speed Price Notes
Lafayette Louisiana 10/10 $28.95 30/30 $44.95 50/50 $57.95 - - All connections come with 100Mbps connections to others on the local network.
Wilson North Carolina 10/10 $34.95 20/20 $54.95 40/40 $99.95 60/60 $199.95 There is also a 100/100 tier for $299.95. These prices come from the bundled options. There is one unbundled option - 20/20 for $59.95
UTOPIA Utah 15/15 $39.95 30/30 $49.95 50/50 $59.95 100/100 $147 This is an open access network, 100/100 is not offered by all service providers
Tullahoma Tennessee 10/1 $37.95 5/3 $49.95 20/5 $59.95 50/15 $149.95 There is also a 100/30 tier for $299.95
Loma Linda California 5/5 $29.95 10/10 $49.95 15/15 $99.95 - -
Compare to the best from the private sector:
Comcast DOCSIS 3 in MN 1/.384 $39.95 12/2 $59.95 16/2 $69.95 22/5 79.95 A higher tier of 50/10 is available for $139.95/month. These are unbundled prices, bundling generally saves $15/month. Speeds are "up to" depending on neighborhood congestion. Comcast marketing makes it difficult to understand what speeds you are paying for.
Verizon FiOS 10/2 $49.99 20/5 $59.95 20/20 $69.95 50/20 $144.95 These are unbundled prices - bundling with phone reduces monthly price by $5. FiOS is not available throughout Verizon footprint.
The table reflects real rates, not short-term introductory rates. Do not be fooled into thinking that community broadband networks are able to offer the best deal because they are use taxpayer dollars. Very few community networks have ever used taxpayer money. Most networks are built using revenue bonds - which means that private investors fund the network, and are typically repaid over a period of twenty years using revenues generated by the services. Some cities choose to "back" the bonds with taxes -- which means that if the network does not generate sufficient revenue, the city will make up the difference with public money. Other cities choose not to back the bonds; this is a choice made by each community and impacts the interest rate on the bonds. In most cases, community networks have been safe investments that have not missed debt payments because the communities had an urgent need for broadband. In many cases, they have so many people wanting to take service, they have long lists for the installers. The idea that these networks frequently fail is an utter myth. However, not all community broadband networks offer the blazing speeds at great prices displayed above -- some were built five years ago, when those speeds were sufficient. Others do not feel the need to push the envelope, the community is content with what they have. However, they are able to meet higher demands if a citizen requires it. So even if a community network advertises its highest tier as being an 8/1, it is likely able to offer an even faster connection to those who need it. This is one of the many benefits of community broadband - the network is accountable to the community. The community broadband networks being built today almost always offer the fastest speeds currently available - as seen above with two ongoing builds, Lafayette and Wilson.
Links
Free UTOPIA on the Fastest Speeds in Utah
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