The FCC Should Only Fund Scalable, Future-Proof Broadband Networks

Benton Institute for Broadband & Society

Wednesday, January 29, 2020

Digital Beat

The FCC Should Only Fund Scalable, Future-Proof Broadband Networks

Jon Sallet

This week the Federal Communications Commission is expected to create the Rural Digital Opportunity Fund. As proposed, the Rural Digital Opportunity Fund will make available $20.4 billion to subsidize deployment of high-speed internet networks to rural areas that don’t have adequate service now. Because the Rural Digital Opportunity Fund represents the vast majority of rural broadband funds available to the FCC over the next ten years, it’s important to make sure the Commission does it right – with an eye on the types of networks unserved communities will need at the end of the decade, not just right now.

And, as we recommend in Broadband for America’s Future: A Vision for the 2020s, the starting point for federal funding of future-proof networks should be a requirement of 100/100 Mbps service without usage limits and latency low enough to run interactive video applications (like videoconferencing) for the foreseeable future.

The FCC is proposing to provide funding for the deployment of high-speed broadband in areas of the United States where there is currently no fixed broadband service that meets the FCC’s broadband speed standard (25/3 Mbps). Prospective providers will bid to win subsidies to build, at a minimum, 25/3 Mbps networks with a usage allowance that is the greater of 250 GB per month. The auction is structured to reward better performance, and that’s a good thing. But there must be an expectation that slower speeds will win some of the auctions, else the minimum speeds would not be available, and the FCC would not have recently added a 50/5 Mbps speed tier as eligible for funding.

What will communities served by 25/3 Mbps networks be like in 2025? Or 2030? What broadband capacity will people need to learn, or work, or access healthcare?

Broadband connections in the United States now regularly deliver 100 Mbps downloads and are increasingly capable of reaching 1 Gbps symmetrical speeds. The cable industry is working on 10G. In other words, the bandwidth demands of broadband subscribers are only likely to increase in coming years as broadband becomes ever more important to the daily lives of everyone in America.

If we’re increasingly moving toward a Gig society, what happens to the Rural Digital Opportunity Fund’s 25/3 Mbps communities? Especially since, once built at 25/3 or 50/5, there is no requirement that they ever be upgraded.

Federal funds for the construction of broadband networks should focus on future-proof, scalable networks that will last at least a decade. That’s fiscally responsible. And it’s the basis for our recommendation that the minimum requirements should equal or exceed 100/100 Mbps; we’ve heard from industry observers that networks built to this performance level are extremely likely to be easily and relatively cheaply upgraded as demand for broadband builds.

But it’s extremely unlikely that new 25/3 Mbps or even 50/5 Mbps networks will be adequate in ten years.

We’ve already seen what happens when the FCC funds the construction of networks that are not fit for the future. At the beginning of the last decade, the FCC paid for the construction of “broadband” networks by so-called price-cap carriers that had to provide 4/1 Mbps service. Then, halfway through the decade, the FCC offered more money for 10/1 Mbps networks. Now, the FCC is poised to spend a great deal of money to build new networks again in the same places where it paid for the 10/1 Mbps and 4/1 service. Why? Because the requirements for broadband performance failed to look to the future.

Of course, there may be places where 100/100 Mbps can’t yet be built — and the people who live and work in those places need internet access as much as anyone else in America. But the answer is not to lock those places into 25/3 Mbps or 50/5 Mbps service for a decade or longer.

In other words, the FCC should use its new $20.4 billion fund wisely.

First, the FCC should require at least 100/100 Mbps service with no usage limits and latency low enough to run interactive video applications (like videoconferencing). Good policy demands that performance criteria—like low latency, symmetry, and the amount of data that can be received and sent each month—be treated as importantly as speed alone. Where that’s not possible to achieve today, the better way forward is to provide those places with short-term broadband support with an eye towards running another reverse auction in those places in a few years to see if future-proof networks can then be constructed. And, if not, then to keep trying.

Second, the Rural Digital Opportunity Fund should reserve more money for the second phase.  Effective public policy requires accurate data incorporated into accurate maps to establish eligibility accurately. Currently, knowing just where broadband is and isn’t available is more difficult than should be expected. Policymakers and citizens need a true portrait of broadband deployment—not only where it is but what it is; not only the speeds at which it operates but its critical performance criteria, including latency and monthly capacity limits (if any), as well as pricing.

We know that there are communities without 25/3 service that will be treated as ineligible for the first round because of the way that the FCC’s Form 477 analysis overstates deployment. For example, pilot state mapping projects in Missouri and Virginia found that 38% of rural locations were mischaracterized as served when they were not.

Ensuring greater funding in the second round is one way to ensure that such communities are not left out. The FCC should also consider implementing a fast-track certification by local communities (who tend to know where broadband is and is not) to determine eligibility in the first round. (As it now stands, the FCC process allows challenges to show that an “unserved” area is “served” but lacks a mechanism by which communities can show that a “served” area is, in fact, underserved.)

Policymakers are grappling with the challenge of ensuring that broadband deployment is as successful in the next decade as the provisions of electricity and telephone service were in the 20th century. But, as it happens, the goals of fiscal responsibility and better broadband are best achieved by funding future-proof networks now.

Jonathan Sallet is a Benton Senior Fellow. He works to promote broadband access and deployment, to advance competition, including through antitrust, and to preserve and protect internet openness. He is the former-Federal Communications Commission General Counsel (2013-2016), and Deputy Assistant Attorney General for Litigation, Antitrust Division, US Department of Justice (2016-2017). ​

The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.

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