Net Neutrality Friday

Last week I wrote about the prioritization of issues in the Telecom Regulatory World. I wrote that I prioritized Universal Broadband Access over Net Neutrality. I want to explain why I do so and hope I can convince you of it. I normally write factual pieces but this piece is pure opinion. You should view what I write with your skeptical hats on here.

So, what do I mean by Universal Broadband Access? To me, Broadband ought to be under the same rules that we set up a long time ago for Plain Old Telephone Service (POTS). POTS is the only Universal Telecom service that we have. It is mandatory that if you build a dwelling that your Carrier of Last Resort (generally the Incumbent Local Exchange Carrier) give you a phone line. To help this in what are considered High Cost Areas, we all pay into the Universal Service Fund. The goal of the fund was to make sure that the cost of a phone line was not greatly different for rural users and urban ones. Since the costs of rural phone service (and broadband) are higher than urban, this was used to help defray the costs of construction and maintenance of these networks.

There are a couple of problems with the definition alone. We would have to identify what is meant by Broadband. It is likely that we would have to estimate future definitions so that companies can pick technologies that make sense. We also now have at least 2 wireline (Telco and Cable) as well as wireless as a possibility. Being a Carrier of Last Resort has not been popular in the past, so I am not sure that folks will fight to have that title. But it is possible.

The reason that I believe this is so important is that most people don’t realize why we don’t have 100% Broadband Coverage today. Like many things in our world it is all about money. Service Providers evaluate network construction and expansion projects based around Return On Investment or ROI. Many of these rural projects are just low ROI. Nothing really changes that, including low cost loans for construction. Service Providers have so many things that they can invest in that they never get to these projects. They are not just playing these projects off against other rural infrastructure. They are compared to all projects. Do I do rural broadband for that small town or do I do fiber installation for that business park? My opinion is that we will never reach 100% coverage until we make it mandatory. Remember that phone coverage did not get to be 100% until we did so. It seems likely to be required again.

My view is that Net Neutrality violations would always come from the hue and cry of the public. If Netflix was shut down or some other popular service was interrupted, the FCC would intervene. That is why I think that converting to Title II was less important. We had a problem that might happen in the future (remember the Netflix/Comcast issue was really caused by Cogent – a Netflix vendor) versus one that is still happening today. I always pick today first.

Have a great weekend!

Jim Sackman
Focal Point Business Coaching
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