Friday, February 26, 2021
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FCC Adopts Report and Order for Emergency Broadband Benefit Program (details to follow)
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Late night Feb 25, the Federal Communications Commission voted to formally adopt a Report and Order that establishes the Emergency Broadband Benefit Program, a $3.2 billion federal initiative to provide qualifying households discounts on their internet service bills and an opportunity to receive a discount on a computer or tablet. As of 7:30 am Feb 26, the order had not been released so no details of the FCC decision are yet available. FCC Acting Chairwoman Jessica Rosenworcel said the Commission is already at work to get the program up and running, "I expect it to be open to eligible households within the next 60 days as providers sign up and program systems are put in place."
Emergency Broadband Benefit Program stakeholders adopted a variety of positions on specific issues, with attention coalescing around several points:
- Broadband speed benchmark. Some called for a higher benchmark than the Federal Communications Commission 's 2015 25/3 Mbps to enable a wider range of web-based services. Others have voiced concerns that this would require broadband providers to make infrastructure investments not justified by existing demand, or might price low-income subscribers out of the market.
- Technology standards: Commenters sought FCC eligibility rules for inclusion or exclusion of certain technologies to support preferred business or policy goals.
- Eligible providers
- Participation incentives: Broadband provider participation in the Lifeline program has declined in recent years. Some commenters voiced concerns that providers would not participate in EBB in sufficient numbers unless the FCC provided adequate incentives. Consumer advocates sought FCC support for vigorous outreach and education and simplification of enrollment and eligibility verification procedures.
- Program effectiveness and timelines: Commenters sought clarification of program scope and goals, measures of effectiveness, and reporting requirements to guide implementation and benchmark progress.
- Waste, fraud, and abuse
The Feb 25, 2021, deadline for the FCC to publish EBB program rules may serve to compel FCC policy decisions in a number of key issue areas outlined above. EBB implementation may provide indication of the future direction of federal broadband policy under the Biden Administration. Likewise, the short duration of the program provides a potential opportunity for Congress to assess policy outcomes and consider longer-term changes to FCC USF programs if desired.
The Federal Communications Commission is establishing a new system of records, FCC/WCB–3, Emergency Broadband Benefit Program, subject to the Privacy Act of 1974. This system of records is maintained for use in determining whether a member of a household meets the eligibility criteria to qualify for a discount on the cost of internet service and a subsidy for low-cost devices such as computers and tablets; ensuring benefits are not duplicated; dispute resolution regarding eligibility for the Emergency Broadband Benefit Program; customer surveys; audit; verification of a provider’s representative identity; and statistical studies.
[Written comments are due on or before March 29, 2021. This action (including the routine uses) will become effective on March 29, 2021 unless comments are received that require a contrary determination.]
This 2019 Digital Divide Index (DDI) is an updated version that scores: the overall digital divide index, infrastructure/adoption, and socioeconomic. For purposes of this post, we divided all census tracts in the country, whose DDI could be calculated, into three equal groups (roughly same number of tracts per group) based on their DDI score: low, medium, and high. Of the roughly 324 million residents in the U.S. according to the 2015-2019 American Community Survey, 123 million or 38% lived in tracts with a low digital divide versus 108 million or 33% in tract with a medium digital divide and 92 million or 28% in tracts with a high digital divide. In terms of age, roughly 21 million or 29% of children and 16 million or 32% of those ages 65 or older lived in tracts with a high digital divide.
Over the last few months, the National Broadband Availability Map (NBAM) added Alaska, Connecticut, Florida, Hawaii, Montana, New York, Oklahoma and Vermont to its growing roster of state participants. To date, the NBAM includes 30 states and four federal agencies: the Department of Agriculture (USDA), the Bureau of Indian Affairs (BIA), the Economic Development Administration (EDA), and the Appalachian Regional Commission (ARC). The NBAM is a geographic information system platform that allows for the visualization and analysis of federal, state, and commercially available data sets. This includes data from the Federal Communications Commission, Census Bureau, Universal Service Administrative Company (USAC), USDA, Ookla, Measurement Lab, and the state governments. The mapping platform provides users, including administrators from the 30 participating states, with access to the NBAM and its data to better inform broadband projects and funding decisions in their states.
Lawmakers and industry groups are jockeying to shape the broadband internet investments likely to be embedded in President Joe Biden’s infrastructure efforts. Senior Democrats like House Whip Jim Clyburn (D-SC) are eyeing a revival of their $100 billion package aimed at connecting the unconnected and funding programs to bolster digital equity, which is likely to take center stage in coming weeks. But Republicans, bless their hearts, bristle over bigger price tags and instead point to less costly ways to close the digital divide. “You’ve gotta pay for all of this stuff,” said Bob Latta (R-OH), the top Republican on the House Communications Subcommittee, referring to the pricier Democratic broadband proposals. “How do they come up with these figures and how are you going to spend it?” Although he prizes broadband’s bipartisan deal-making potential, he and many other congressional Republicans favor removing the regulatory hurdles broadband providers face in trying to build out their networks (like permitting on federal lands) and keeping investments tailored to avoid subsidizing competition with incumbent broadband providers. Watch for these debates to heat up this spring. Lawmakers will likely take on some of these infrastructure questions in the coming months after they wrap up the current pandemic relief bill. Although they’re able to pass this aid package without GOP buy-in, using budget reconciliation, they may need Republicans to move forward on infrastructure.
Current levels of broadband deployment subsidies should be maintained or increased over the next five years, but policymakers will need to change the way these subsidies are distributed. The base for the Universal Service Fund needs to be broadened and made sustainable. Except in the most remote areas, the standard for publicly subsidized broadband networks should be set at 1 Gbps symmetrical or higher to ensure that public investments will be usable for a generation or longer. Requirements for latency and reliability should also be set at a high level. The Federal Communications Commission must vet high-cost program recipients to ensure their plans for achieving broadband standards are realistic. It should hold them to account for meeting their obligations, and claw back and discontinue funding for those that fail to do so. Other grantors should follow similar policies. Public subsidies for broadband should finance fiber backhaul to the internet where necessary. Congress should pass legislation explicitly authorizing the use of E-Rate funding to connect households with schoolchildren to the internet. Congress should enact a permanent broadband benefit paid directly to eligible households and used by them to pay any broadband provider. It can be administered similarly to benefit programs designated for food, heating or education. The amount of the benefit should be sufficient to pay for adequate (not “budget-tier”) broadband. Congress should clarify and safeguard the right of municipalities and municipal utilities to finance, build and operate broadband networks. Federal broadband subsidies should not be made contingent on proposed service areas being unserved or having previously received subsidies. Of course, the quality and price of any existing broadband service in the area should be considered in evaluating the proposer’s business plan. Any entity that can demonstrate technical and financial capacity to build and operate its proposed network should be eligible to apply for broadband grants, loans and other subsidies. The FCC must develop and maintain a granular, accurate, up-to-date broadband map that is correctable through crowdsourcing, and Congress must actively oversee the progress of the mapping effort.
When Lt. Gov. Delbert Hosemann and lawmakers in the Mississippi legislature got $1.2 billion in federal money from the first stimulus bill in March, they decided to do something different. They used a portion of the funds to supercharge the rollout of high-speed broadband to the most underserved areas of the state in an effort to close the digital divide. They went to rural electric co-ops -- private, independent electric utilities owned by the members they serve -- many of which were left gobsmacked by the offer, according to David O'Bryan, general manager of Delta Electric Power Association, which now serves Carroll and Grenada counties with broadband. Many of these co-ops had been preparing to deploy networks but lacked the cash to begin a major project, especially in the most remote and sparsely populated parts of their territories. The result has been an acceleration in broadband deployment that could make Mississippi one of the most connected states in the nation within the next five to six years. That's a huge leap for the state, which last year ranked 42 out of 50.
Broadband service gets notoriously worse as you move farther from urban areas, creating gaps in internet access that became more visible after the coronavirus pandemic forced people to work from home, attend school virtually and even see their doctors online. The problem isn't new — people have complained for years about the lack of broadband — but government officials across northeastern Wisconsin are now accelerating efforts to improve speeds in some of the region's most remote areas. One major step for Brown County is finding out exactly how bad the problem is for some residents. In December, the county began encouraging residents to take an internet speed test.
The Virginia General Assembly has spent more than $130 million to tackle the digital divide, and lawmakers are considering a few measures to get more people connected, including another big investment to help telecommunication companies and municipal broadband authorities build internet infrastructure across the commonwealth. The House of Delegates and Senate both want to put $50 million into the budget for the Virginia Telecommunications Initiative, one of the primary mechanisms the commonwealth uses to reach areas where there is no broadband. The program requires funded projects to be public-private partnerships, with a local government partnering with a private sector internet service provider to bring service to that community. The budget also includes a provision to allow municipal broadband authorities to apply for VATI grants without a private sector partner, meaning the authorities would serve as the internet service provider on the application rather than a company like Cox or Shentel. This has been a priority for the taxpayer-funded Roanoke Valley Broadband Authority, which has built more than 100 miles of fiber backbone and is moving into residential service.
How do we ensure that broadband service providers enable access to all lawful content and applications regardless of the source, and without favoring or blocking particular products or websites? This now-decades-long debate added a new chapter this week when Judge John Mendez of the U.S. District Court for the Eastern District of California denied a request by broadband provider lobbyists, including the American Cable Association, CTIA-The Wireless Association, NCTA-The Internet & Television Association, and USTelecom, to delay net neutrality rules adopted in California. The ruling clears the way for California to enforce broadband consumer protections similar to those adopted by the Federal Communications Commission in 2015, but subsequently repealed in 2018.
In 2017, the broadband industry appeared to win its battle against net neutrality. Under the Trump administration, the US Federal Communications Commission rolled back rules that barred internet service providers from blocking or slowing down traffic to certain websites or charging some sites a fee for preferential treatment. Net neutrality was, effectively, dead. But the regulatory change turned out to be a Pyrrhic victory for telecom companies. The FCC’s decision opened the door for states to pass their own laws managing the internet. On Feb. 23, a federal judge paved the way for California to do just that: The state can now implement its 2018 net neutrality law, which reinstates all the former FCC net neutrality rules within California. For the telecoms, the trouble started the moment they won their fight before the FCC in 2017. The industry didn’t just get the agency to repeal its net neutrality rules—it convinced the FCC to rule that it never had the authority to create net neutrality regulations in the first place. That left the agency powerless to stop states from filling in the vacuum with their own legislation. When the FCC tried to overrule the states’ laws, the Washington DC court of appeals declared that if the agency had no power to make net neutrality rules, it also had no power to invalidate state’s rules.
A Q&A with New York Times reporter Cecilia Kang. Why does the net neutrality fight matter? Many Americans have only one or possibly two options for home internet providers. Those companies can in theory decide whether we can view Netflix or YouTube crystal clear or if we see the pinwheel of death as those sites stutter. You can see the appeal of rules that make sure internet providers don’t stall web traffic unless it’s from their preferred business partners or their own streaming services. However, the debate feels much less urgent now that we’re talking about threats of online disinformation about vaccine deployment and elections. The net neutrality debate focused on internet service providers as powerful gatekeepers of internet information. That term now seems better applied to Facebook, Google and Amazon. Can we reach a solution in Washington? There probably isn’t much of a middle ground. There are either net neutrality rules or there aren’t. And the internet service providers see net neutrality as a slippery slope that leads to broader regulation of high-speed internet services or government-imposed limits on prices they can charge. They will fight any regulation. And that’s true, too, of the lobbyists who are hired to argue against anything.
The ongoing challenge of regulatory oversight in an era of rapid technological change is to maintain the flexibility to deal with unanticipated developments. What is essential for the future of meaningful net neutrality, therefore, is the agility to adjust to new technology and new marketplace behaviors. It was for this reason that the 2015 Open Internet Rule decision included a “General Conduct Rule” that empowered the agency to determine whether the action of an ISP was “just and reasonable.” The inquiry into self-preferencing started by the Obama Federal Communications Commission, for instance, was based on whether the practice violated the General Conduct Rule. The companies hated the General Conduct Rule because it gave the FCC continuing oversight of their internet activities.
No doubt, when the Biden FCC revisits the net neutrality question, the ISPs and their allies will again fight what they will describe as the “regulatory uncertainty” of the General Conduct Rule. If they succeed in defining net neutrality as only blocking and throttling, the ISPs will have created a digital Maginot Line. Like the Maginot Line that proved of no value at the outset of World War II, a fixed set of rules would be easy for a nimble network to get around. To encase the FCC’s open internet activities in the concrete of rigid rules would be as foolish as to entrust the defense of France to concrete fortifications at a time of the rapid blitzkrieg.
The public interest that is inherent in open and non-discriminatory networks has been well established for over half a millennium. The Trump FCC walked away from that responsibility; now it falls to the Biden FCC to stand up for consumers and a competitive and innovative internet.
On paper, Feb 25’s House Antitrust Subcommittee hearing was about analyzing how big tech platforms act as gatekeepers and create barriers to entry — but really it was about testing out three new avenues for keeping tech companies in line and seeing which ones might gain support from tech-skeptical Republican representatives. But at the hearing, the subcommittee moved beyond calling out bad behavior and laid out three big areas where Congress could actually take action:
- Data interoperability and portability: Users should be able to take their data elsewhere with ease. Example: Think about how you can move your phone number between carriers. Before the 1996 Telecommunications Act, that wasn’t always an option.
- Nondiscrimination: Basically, a dominant platform shouldn’t be able to preference its own products over those of its competitors.
- Structural remedies: Breaking apart different lines of business or platforms under one company.
The subcommittee on antitrust still has two more hearings to complete before they start filing legislation. They’re expecting to start introducing certain bills this spring, but that doesn’t mean they’ll become law anytime soon. There will likely be even more hearings and a markup process before those bills get close to votes on the floor.
AT&T agreed to sell a stake in its pay-TV unit to private-equity firm TPG and carve out the struggling business, pulling the telecom giant back from a costly wager on entertainment. The transaction would move the DirecTV and AT&T TV services in the US into a new entity that will be jointly run by the new partners. AT&T will retain a 70% stake in the business. TPG will pay $1.8 billion in cash for a 30% stake. The deal values the new company at $16.25 billion with about $6.4 billion of debt. That is well below the $49 billion—about $66 billion including debt—that AT&T paid to buy international satellite operator DirecTV in 2015. AT&T recently struck $15.5 billion off the value of the unit, reflecting the service’s dimmer prospects. AT&T said it would get about $7.8 billion in cash from the transaction to help pay down debts. Those proceeds include $5.8 billion that the new company will borrow from banks and pay back to AT&T.
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