January 2015

China has long had some of the world’s most onerous Internet restrictions. But until now, the authorities had effectively tolerated the proliferation of virtual private networks as a lifeline for millions of people, from archaeologists to foreign investors, who rely heavily on less-fettered access to the Internet. But recently, after a number of VPN companies, including StrongVPN and Golden Frog, complained that the Chinese government had disrupted their services with unprecedented sophistication, a senior official for the first time acknowledged its hand in the attacks and implicitly promised more of the same.

The move to disable some of the most widely used VPNs has provoked a torrent of outrage among video artists, entrepreneurs and professors who complain that in its quest for so-called cybersovereignty -- Beijing’s euphemism for online filtering -- the Communist Party is stifling the innovation and productivity needed to revive the Chinese economy at a time of slowing growth.

• Wheeler: Today we closed bidding Auction 97 -- by far the highest-earning spectrum auction the United States has ever seen. But it was much more than that. This auction also marked a new era in spectrum policy, where a collaborative and unprecedented effort resulted in new commercial access to federal spectrum bands. A bipartisan group of leaders in Congress, federal agencies -- especially NTIA and DoD -- the White House, industry, and the team at the FCC all came together to help meet the Nation’s demand for wireless broadband. Improving consumer access to wireless broadband is a priority of mine, and has been a priority of the Commission over the past five years. Now, an additional 65 megahertz of spectrum is available to improve wireless connectivity across the country and accelerate the mobile revolution that is driving economic growth and improving the lives of the American people. The results of this auction confirm the strong market demand for more spectrum. We are confident there will continue to be strong demand for valuable low-band spectrum that will be made available in the Incentive Auction early next year.
• Clyburn: If you had conducted a poll of analysts before the start of the AWS-3 auction, the highest prediction given for its yield would not have exceeded $18 billion. Seventy-seven days and a record setting $44.89 billion later, Auction 97 has shown that demand for this spectrum was phenomenal. Some experts opine that the winning bid total is due in large part to bidding and other competitive strategies unique to this band. I believe one of the key factors for this unanticipated level of activity is that the AWS-3 bands are near the AWS-1 bands and there are already base stations and other equipment available. Once the FCC makes the bidding activity public, I suspect there will be many more stories about the results of this auction. Nevertheless, what we can all agree on is that the auction’s success would not have been possible without the diligent efforts of the Wireless Telecommunications Bureau staff, who worked in cooperation with NTIA, DoD and other federal agencies to substantially reduce the protection zones of federal operations in the 1755 and 1780 MHz band. I also want to commend Chairman Wheeler for developing a band plan with smaller license blocks and geographic license areas, and crafting a strong interoperability mandate to encourage robust participation by both small and large entities.
• Pai: The AWS-3 auction has been a historic success, raising almost $45 billion in provisionally winning bids. This is great news for several reasons. The auction will help us fund the national priorities identified by Congress, including deficit reduction, the advancement of wireless public safety communications, the deployment of NG911, and FirstNet. It will help the wireless industry meet exploding consumer demand. And it will broaden the American platform for wireless innovation, already the world’s envy. We can already draw a few lessons from the AWS-3 auction, beyond the obvious fact there is intense demand for mid-band spectrum. The most important is that the way the FCC structures an auction matters. In AWS-3, we made the rules as simple as possible. We maintained open eligibility. And we auctioned off spectrum that was internationally harmonized for commercial use. These decisions yielded robust competition and helped maximize revenues. I hope we take a similar approach in future auctions.
• O’Rielly: The conclusion of today’s AWS-3 auction reemphasizes that licensed spectrum is valued more highly than ever in the marketplace. Credit needs to be given to Congress, especially Chairmen Upton and Walden, for its leadership in setting forth the directives that allowed for such a successful outcome. I’m excited to see this spectrum put to good use by winning bidders, transforming our current wireless broadband networks for the benefit of American consumers.
• Rosenworcel: Today’s conclusion of the AWS-3 auction demonstrates the extraordinary value of the airwaves all around us. Putting spectrum like this into the marketplace not only expands the possibilities for wireless services, it strengthens the new digital economy. In addition, the results of this auction will pave the way for improved public safety services, bringing new connectivity to our Nation’s first responders. Kudos to those in both the public and private sector who worked to make this auction such a success.

Broadband deployment in the United States -- especially in rural areas -- is failing to keep pace with today’s advanced, high-quality voice, data, graphics and video offerings, according to the 2015 Broadband Progress Report adopted by the Federal Communications Commission.

Reflecting advances in technology, market offerings by broadband providers and consumer demand, the FCC updated its broadband benchmark speeds to 25 megabits per second for downloads and 3 Mbps for uploads. The 4 Mbps/1 Mbps standard set in 2010 is dated and inadequate for evaluating whether advanced broadband is being deployed to all Americans in a timely way, the FCC found. Using this updated service benchmark, the 2015 report finds that 55 million Americans -- 17 percent of the population -- lack access to advanced broadband. Moreover, a significant digital divide remains between urban and rural America: Over half of all rural Americans lack access to 25 Mbps/3 Mbps service.

Using this updated service benchmark, the 2015 report finds that 55 million Americans – 17 percent of the population – lack access to advanced broadband. Moreover, a significant digital divide remains between urban and rural America: Over half of all rural Americans lack access to 25 Mbps/3 Mbps service.

The divide is still greater on Tribal lands and in U.S. territories, where nearly 2/3 of residents lack access to today’s speeds. And 35 percent of schools across the nation still lack access to fiber networks capable of delivering the advanced broadband required to support today’s digital-learning tools.

While significant progress in broadband deployment has been made, due in part to the Commission’s action to support broadband through its Universal Service programs, these advances are not occurring broadly enough or quickly enough, the report finds. The report concludes that more work needs to be done by the private and public sectors to expand robust broadband to all Americans in a timely way, and the accompanying Notice of Inquiry seeks comment on what additional steps the FCC can take to accelerate broadband deployment.

Key findings include the following:

• 17 percent of all Americans (55 million people) lack access to 25 Mbps/3 Mbps service.
• 53 percent of rural Americans (22 million people) lack access to 25 Mbps/3 Mbps.
• By contrast, only 8 percent of urban Americans lack access to 25 Mbps/3 Mbps broadband.
• Rural America continues to be underserved at all speeds: 20 percent lack access even to service at 4 Mbps/1 Mbps, down only 1 percent from 2011, and 31 percent lack access to 10 Mbps/1 Mbps, down only 4 percent from 2011.
• 63 percent of Americans living on Tribal lands (2.5 million people) lack access to 25 Mbps/3 Mbps broadband
• 85 percent living in rural areas of Tribal lands (1.7 million people) lack access.
• 63 percent of Americans living in U.S. territories (2.6 million people) lack access to 25 Mbps/3 Mbps broadband.
• 79 percent of those living in rural territorial areas (880,000 people) lack access.
• Overall, the gap in availability of broadband at 25/3 closed by only 3 percentage points last year, from 20% lacking access in 2012 to 17% in 2013
• Overall, the broadband availability gap closed by only 3 percent last year.
• Americans living in rural and urban areas adopt broadband at similar rates where 25 Mbps/ 3 Mbps service is available, 28 percent in rural areas and 30 percent in urban areas.
• Approximately 35 percent of schools lack access to fiber, and thus likely lack access to broadband at the Commission’s shorter term benchmark (adopted in its July 2014 E-rate Modernization Order) of 100 Mbps per 1,000 users, and even fewer have access at the long term goal of 1 Gbps per 1,000 users.

Section 706 of the Telecommunications Act of 1996 requires the FCC to report annually on whether broadband “is being deployed to all Americans in a reasonable and timely fashion,” and to take “immediate action” if it is not. Congress defined broadband as “high-quality” capability that allow users to “originate and receive high-quality voice, data, graphics, and video” services.

The FCC's reevaluation of the broadband marketplace is long overdue. The law directs the FCC to periodically revisit and update its standards for broadband to take into account advances in technology, consumer behavior, and the marketplace. For too long, the FCC has gotten by with an outdated standard for broadband, and as a result its analysis of the marketplace grew increasingly antiquated. As a result, discussions around broadband policy have been muddied. Because broadband is so essential to free expression, health, jobs, education, and many other things, it is important to take a clear-eyed view of the state of broadband deployment and competition.

The National Broadband Plan set a goal stating that, by 2020, ‘at least 100 million U.S. homes should have affordable access to actual download speeds of at least 100 megabits per second.’ Today’s report is an important finding of fact that can help the FCC more accurately assess our progress toward that goal, and one that is relevant to a number of other FCC proceedings. Updating its standards after such a long time means that there is a substantial jump -- from 4 Mbps downstream to 25 Mbps. We encourage the FCC to gradually improve its standards in the future to keep pace with the state of the art in broadband, including taking into account billing and network management practices, such as data caps.