March 2010

The Federal Communications Commission on Tuesday made public the details of its ambitious policy to encourage the spread of high-speed Internet access. But their 376-page proposal, the National Broadband Plan, was met with a chorus of questions, even from the staunchest advocates of its goals.

Telecommunications companies praised the intent but worried that new regulations might impede rather than encourage their progress in expanding Internet access. Industry analysts said the plan was both too ambitious and not detailed enough, and consumer advocates doubted it alone would lead to more affordable broadband service at adequate speeds. The criticisms were largely tempered by a strong embrace of what is by far the most aggressive effort to date by regulators to encourage widespread adoption of broadband at much higher speeds than most Americans have today. Some aspects will take years to put into place and require Congressional action.

With the public release of its national broadband plan Tuesday, the Federal Communications Commission prepared to start the hard work of getting Congress to help the agency implement roughly 200 recommendations. The bulk of the recommendation can be enacted by the FCC, such as diverting money from a fund for affordable phone service to rural areas to be used for increasing broadband access. But Congress would have to act on others, particularly changing rules for federal auctions of federal airwaves to entice some broadcasters to give up their spectrum so the airwaves could be used for wireless Internet access.

While praising the effort put into drafting the plan, the FCC's two Republicans cautioned against moving too quickly. They said it was important to assess whether government actions would discourage the private investment needed for telecommunications companies to expand their networks. Those concerns were echoed by some free-market think tanks, which warned of increased government involvement in a market they said has flourished through vibrant competition. But consumer and business groups, along with telecommunications companies, generally praised the plan for pressing for more affordable Internet access even as they said they were still analyzing the specifics.

The Federal Communications Commission delivered "Connecting America: The National Broadband Plan" to Congress on Tuesday. The Plan's call for action over the next decade includes the following goals and recommendations:

1. Connect 100 million households to affordable 100-megabits-per-second service, building the world's largest market of high-speed broadband users and ensuring that new jobs and businesses are created in America.
2. Affordable access in every American community to ultra-high-speed broadband of at least 1 gigabit per second at anchor institutions such as schools, hospitals, and military installations so that America is hosting the experiments that produce tomorrow's ideas and industries.
3. Ensure that the United States is leading the world in mobile innovation by making 500 megahertz of spectrum newly available for licensed and unlicensed use.
4. Move our adoption rates from roughly 65 percent to more than 90 percent and make sure that every child in America is digitally literate by the time he or she leaves high school.
5. Bring affordable broadband to rural communities, schools, libraries, and vulnerable populations by transitioning existing Universal Service Fund support from yesterday's analog technologies to tomorrow's digital infrastructure.
6. Promote competition across the broadband ecosystem by ensuring greater transparency, removing barriers to entry, and conducting market-based analysis with quality data on price, speed, and availability.
7. Enhance the safety of the American people by providing every first responder with access to a nationwide, wireless, interoperable public safety network.

Phoebe Yang, general counsel for the national broadband plan team said that as a result of the plan, more than 40 proceedings will be presented to the FCC. Of these, she said half are focused on applications, while a quarter involve the Universal Service program and intercarrier compensation. The rest involve public safety, she said.

Congress will be asked to take action on three areas, Yang said. These include funding for the proposed national broadband wireless public safety network and optional funding to accelerate broadband deployment goals. She also said Congressional action would be sought on certain matters pertaining to accelerating broadband adoption.

Here are some of the highlights of the National broadband Plan that appear most critical to the telecommunications industry, based on a preliminary review of the plan.

1) The plan includes no target date for phasing-out traditional telephone service.

2) The Universal Service Fund will not grow.

3) The plan would allow rate of return carriers to transition to price cap financial metrics, with the goal of minimizing USF payments to those carriers.

4) No resolution on information versus telecommunications service debate.

5) Interstate access diverted to fund broadband.

6) Phantom traffic should be prohibited.

7) Door open to increased unbundling requirements. 8) Door open to special access rate changes. 9) New set top box requirements.

10) Release of the plan represents the beginning, not the end of the process.

The FCC will use 4 Mb/s download speeds as the definition of broadband for the proposed Connect America Fund, which it proposes to replace today's Universal Service high-cost fund.