Recap: Connecting Main Street to the World: Federal Efforts to Expand Small Business Internet Access (updated)

The Senate Committee on Small Business and Entrepreneurship held a hearing April 27 on Federal efforts to expand small business Internet access.

Federal Communications Commission Chairman Julius Genachowski said transforming the Universal Service Fund into a broadband fund and freeing up spectrum so that mobile wireless is available everywhere are keys to getting the benefits of broadband to small businesses. He said that almost 50% of small businesses don't have access to high speed at all (at least 4 Mbps), and that those that do find too few choices, slow speeds and high prices. He also said mobile broadband would be a huge generator of economic growth. Sen Olympia Snowe (R-Maine) said she wanted a timetable from the FCC and others on when high-speed would be deployed. Genachowski said the FCC was preparing to fill out the mileposts between the FCC's five and 10-year plans for broadband deployment.

American Cable Association Chairman and Wave Broadband COO Steve Friedman told the Committee that small and medium-sized telecommunications and information service providers have been "effectively excluded" from the broadband stimulus program thanks to rules that are unfair and unbalanced and a program that has been poorly run. Meanwhile, overbuilders have been given government grants to provide broadband service in competition to those operators.

National Association of Broadcasters President Gordon Smith testified in hopes of defending broadcast television station owners' use of spectrum for free. He denied a report that he and FCC Chairman Genachowski reached "any deal" on the issue during a meeting in Las Vegas. Smith said one piece of the spectrum plan that is "of great concern" is the spectrum fees that have been proposed in the national broadband plan. He said that a "punitive fee" could force some small broadcasters off the air. Smith said that broadcasters were a highly efficient system, while wireless was a "spectrum hog." He said that the FCC "should encourage the deployment of fixed wireless broadband services in rural areas using empty broadcast channels. If done the right way, this service has the ability to greatly increase rural penetration for hard-to-reach constituencies without taking spectrum from broadcasting."

Update:
Sen Jeanne Shaheen (D-NH) raised concerns on Tuesday that federal regulators are wasting taxpayer dollars by funding duplicative broadband infrastructure projects as part of the $7.2 billion broadband stimulus program. She also pressed on NTIA and RUS on whether or now their awards may have driven up commercial broadband deployment costs in some markets. Lawrence Strickling, an assistant Commerce secretary who directs the National Telecommunications and Information Administration, responded by saying any claims that duplication exists are "not serious objections." Strickling said his agency uses data on broadband penetration and speeds when choosing where to allot money, arguing that the need for broadband spending may not be apparent in certain areas where consumers have strong Internet connections in their homes but anchor institutions, including hospitals and schools, continue to lack the necessary infrastructure. Jonathan Adelstein, head of USDA's Rural Utilities Service, echoed this view. "There has not been one example of overbuilding," he said, noting that his program focuses on building the "last mile" of connectivity while NTIA targets the middle mile.