Tuesday, September 27, 2022
Headlines Daily Digest
Broadband Data and Mapping
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Data and Mapping
The next update of the Federal Communications Commission broadband map, expected in late November or early December, is likely to have a considerable number of errors, according to sources familiar with the broadband data collection initiative on which the map will be based. The new map will be based on data collected from broadband providers. Those providers were required to enter broadband availability data on a per-location basis into an FCC-provided database. The database, created by a company contracted by the FCC, was designed to provide address and geolocation information (latitude and longitude) for every broadband serviceable location in the country. Therein lies the problem, as nearly 90% of rural broadband provider members of NTCA – The Rural Broadband Association saw some locations missing in the FCC database, said Mike Romano, NTCA executive vice president. Another two-thirds of members saw extra locations, Romano noted. However, only challenges submitted by a certain date will be reflected in the second iteration of the FCC broadband map, the one everyone hopes will be correct. Though, the FCC just has not yet revealed that date.
For years, cable companies have been raising broadband prices annually. While price increases don’t hit every customer immediately because of customers on term contracts, every price increase reaches every customer eventually. The industry has changed, and it doesn’t seem as obvious as in the past that cable companies can raise rates and that customers will just begrudgingly go along with it. The cable companies have stopped growing. This seems to be for a variety of reasons. First, fixed wireless access (FWA) cellular carriers are thriving. What’s making FWA attractive is the price of $50-$60 for unlimited broadband—far below the prices charged by cable companies. The cable companies have to be feeling some sting also from the large telecommunications companies and others who are building and selling fiber in cable company markets. The rest of the industry is going to watch this issue closely because it’s going to be easier to compete against cable companies if they continue to raise rates. Higher cable broadband prices let other broadband providers creep up rates and still stay competitive.
Some internet connection providers in Rochester, NY, are ramping up service strength to meet demand. However, for some, internet options are plentiful but inaccessible due to cost. To connect, some utilize access to Wi-Fi from a nearby church to use the internet. To alleviate such issues, Monroe (NY) County Legislator Rachel Barnhart, who serves on the Monroe County's Taskforce on Broadband, said, "We have learned that programs offering reduced cost internet have low uptake because people are not aware they exist or because of red tape. We need better, more accessible options.” To help with internet disparity in a connected world, the federal government has cast a $14.2 billion internet lifeline called the Affordable Connectivity Program (ACP) for families struggling to pay for internet service, affording free internet or money off of monthly bills to households that qualify. The public can apply for these discounts through an online application.
Connected Nation is launching a Digital Literacy program in collaboration with AT&T. The program is part of AT&T’s national digital literacy initiative to help narrow the digital divide. The Digital Literacy program will offer in-person and virtual digital literacy training workshops across the country where this training is needed most for the digital empowerment of residents. In addition to the workshops being held in communities across the US, Connected Nation will lead virtual and in-person workshops for military families at their Digital Works office in Fort Campbell, Kentucky. Workshops topics include internet and computer basics, cybersecurity, email basics, mobile device basics, and web conferencing. Connected Nation will partner with local community organizations across the county to host training workshops from September 2022 through March 2023. To launch this program Connected Nation staff are reaching out to communities that previously participated in the community technology planning process and identified digital literacy as a need. If your community is interested in learning more, visit: https://connectednation.org/digital-literacy-workshops/.
The Moss Adams 2022 Telecommunications Benchmarking Study provides important data and takeaways influenced by this economic landscape, enabling you to assess where your business ranks against other telecommunications companies in key industry areas. The study compiles 2021 data from 115 companies. Participants comprised 55 cooperatives and 60 privately held businesses. Participants came from 41 states and included 70 companies under legacy rate-of-return and 45 companies under model-based support—ACAM I, ACAM II, or Alaska Plan. This review of the benchmarking data focuses on broadband internet, staffing resources, network investment, and overall profitability. See the following takeaways:
- Broadband Internet: Circumstances in the rural telecommunications space continue to foster significant customer growth, speed tier upgrades, and investment in fiber optic network facilities where the median benchmarking study participant experienced 8.2% growth in broadband customers from 2019 to 2020, followed by 5.2% growth from 2020 to 2021.
- Staffing Resources: the data appears to support that companies realized some efficiencies in serving customers over the past several years, despite an overall drop in employee-to-customer ratio from 8 employees for every 1000 customers in 2016, to 7 employees for every 1000 customers in 2021. Though, total revenue per employee continues to trend upward.
- Network Investment: The median company reported the per connection gross network investment at $10,765, however, this figure is down from $12,152 in 2020 which was a peak year over the past 10 years. However, federal funding, such as the Infrastructure Investment and Jobs Act (IIJA) is expected to greatly impact this category.
- Overall Profitability: The industry again experienced strong profitability results in 2021; albeit slightly down in operating income before depreciation and amortization and operating margins from 2020. Overall, broadband internet revenues increased by 13%, bolstering profitability while maintaining 2020 levels of federal Universal Service Funding (USF).
Many attempts to increase the flexibility of wireless spectrum rights meet objections that the method of reallocation will result in a windfall for corporate license holders. Far from being objectionable, however, allowing windfalls in spectrum reallocation creates virtuous incentives. Past restrictions on the supply of flexible-use rights to the spectrum have resulted in a rigid system, which is not in the public interest because the most productive uses of the spectrum change rapidly. Nevertheless, this status quo is difficult to unravel. Processes that could increase the flexibility that is necessary for efficient spectrum use often produce “windfalls” by giving incumbents large paydays or valuable licenses. Many find these outcomes objectionable. Yet the prospect of a windfall creates the incentive to use one’s spectrum efficiently enough to free up all or part of it for other uses and to volunteer restrictive licenses for reallocation, both of which benefit the public. Though some legal maxims disfavor windfalls, the laws, and precedents applicable to spectrum reallocation permit spectrum arrangements that produce them. Ultimately, freeing up more spectrum for flexible use should be the central goal of modern spectrum allocation.
When I launched Broadcom in the early 1990s with the goal of revolutionizing digital connectivity, it was necessary to work closely with governments around the world, starting with cable set-top boxes. When policymakers and innovators collaborate, they can unleash the future of the tech industry, bolster the broader economy, and improve the lives of billions. I’ve seen first-hand how public-private collaboration has accelerated connectivity innovation, and there are compelling opportunities to continue this joint approach that has served the public so well. A great example of this from Broadcom’s early years took place when the Federal Communications Commission set aside wireless spectrum for unlicensed use. This spectrum became an innovation sandbox for Broadcom, turning Bluetooth and Wi-Fi into two of the most successful wireless technologies of all time. Decades later, in April 2020, the FCC made another important policy decision for connectivity when it voted to allocate 1,200 MHz of spectrum in the 6 GHz band for unlicensed use, tapping a crucial spectrum band for making new, faster services publicly available. This groundbreaking act was the culmination of several years of public-private collaboration, with great leadership from the FCC and Congress. And this is just the beginning. In implementing initiatives on unlicensed spectrum and broadband infrastructure, US policymakers stayed abreast of technological change and unleashed innovation.
[Henry Samueli is founder and chairman at Broadcom]
Elon Musk’s Starlink has activated its satellite broadband service in Iran after the US allowed private companies to offer uncensored internet access to the country amid protests that have caused more than 40 deaths. Starlink is the first in a new generation of satellite networks operating in low-Earth orbit that are designed to provide high-bandwidth internet connections from space directly to individual users. Starlink users are able to bypass a country’s terrestrial communications networks, freeing them from internet censorship. However, a special terminal is needed to receive a signal from Starlink’s constellation of satellites 500km above the Earth. The terminals include a 20-inch satellite dish, which is shipped in a package about the size of two pizza boxes stacked on top of each other. “Obviously, the Iranian government is not going to approve it,” Musk said of the Starlink service. “It would require somebody actually buying a terminal and smuggling it into Iran, but they’d be taking a risk because the government won’t be pleased with that.” Under the new guidelines, US technology companies can provide secure platforms and services within Iran without running afoul of restrictions that usually prevent dealings with Iran. The US Treasury’s Office of Foreign Assets Control will also prioritize applications for specific licenses or permissions for businesses related to internet freedom in Iran.
Benton (www.benton.org) provides the only free, reliable, and non-partisan daily digest that curates and distributes news related to universal broadband, while connecting communications, democracy, and public interest issues. Posted Monday through Friday, this service provides updates on important industry developments, policy issues, and other related news events. While the summaries are factually accurate, their sometimes informal tone may not always represent the tone of the original articles. Headlines are compiled by Kevin Taglang (headlines AT benton DOT org) and Grace Tepper (grace AT benton DOT org) — we welcome your comments.
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