Analysis

The Federal Communications Commission recently issued a Second Notice of Proposed Rulemaking concerning the allocation of costs when replacing poles to accommodate adding fiber or other communications wires communications devices to poles. The traditional rule has been that the new attacher must pay for 100 percent of the cost of make-ready, including the cost of pole replacement if there is not sufficient room to add a new wire or device (like a small cell).

There’s a lot of money flowing to 5G network buildouts right now as US wireless operators race to expand their 5G coverage. In fact, it’s likely that 2022 to be the peak year for 5G spending by US wireless operators. Stefan Pongratz, vice president at Dell’Oro Group, said that the company expects US wireless capital expenditures to grow at a double-digit rate in 2022 and then taper off in 2023 and 2024. One reason behind this is that both AT&T and Verizon are ramping up their mid-band 5G deployments in the C-band and the 3.45 GHz spectrum bands.

The big monopoly incumbent providers are aiming their lobbying efforts to influence state lawmakers as states funnel federal funds into state broadband grant programs. In January 2022, Illinois State Senator Patrick Joyce (D-IL) introduced legislation in the Illinois General Assembly known as the Illinois Broadband Deployment, Equity, Access, and Affordability Act of 2022 (SB 3683).

For many years there have been people extolling the huge benefits of public-private partnership for broadband. For all of that talk, there is not a big number of partnerships, but there are some successful examples around the country. Communities that are looking for broadband solutions might want to consider public-public partnerships and non-profit partnerships. I’m seeing public-public partnerships develop that are similar to the more traditional public-private partnership. Existing municipal internet service providers (ISPs) are reaching out to help neighboring communities.

Casey Lide of Keller & Heckman wrote a recent blog that warns that federal grant funding might be considered as taxable income by the Internal Revenue Service (IRS). This would be a dreadful outcome for any taxable entity that receives the grant funding since it would create a huge tax liability that would have to somehow be covered outside of the grant funding.

AT&T announced that it has plans to cut its copper network footprint in half by 2025. However, Jeff McElfish, the CEO of AST&T’s Communications division, said the company isn’t planning to forcibly move customers off copper as they decommission copper. According to McElfish, customers are naturally migrating off copper. I find that hard to believe. CCG Consulting is still seeing DSL penetration rates in cities between 10 percent and 40 percent.

The Federal Communications Commission asks a series of questions about the current set of programs supported though the Universal Service Fund, particularly in light of the broadband initiatives funded through the American Rescue Plan Act of 2021 (ARPA) and the Infrastructure Investment and Jobs Act (IIJA). Commenters have focused heavily on how to fund universal service programs given the problems with the current contribution mechanism and ways to modify existing support programs. We have reviewed these comments and respectfully submit reply comments.

Leichtman Research Group recently released the broadband customer statistics for the end of the fourth quarter of 2021. The numbers show that broadband growth has slowed significantly for the sixteen largest broadband providers tracked by the company. LRG compiles these statistics from customer counts provided to stockholders, except for Cox which is privately owned. Net customer additions sank each quarter during 2021. The first quarter of 2021 saw over 1 million net new broadband customers.

On March 16, 2022, the vast majority of the new rules for the Affordable Connectivity Program (ACP) – the successor program to the Emergency Broadband Benefit (EBB) Program created by Congress in 2021 to help offset the cost of broadband subscription and broadband-capable devices for qualified low-income consumers – became effective.

The National Digital Inclusion Alliance (NDIA) encouraged the Federal Communications Commission to involve trusted community organizations in outreach efforts for the Affordable Connectivity Program (ACP). NDIA also addressed a pilot program focused on promoting ACP enrollment among households participating in Federal Public Housing Assistance programs. NDIA urged the FCC to: