To Jumpstart Broadband Buildout, Let Consumers Decide Who Gets FCC Subsidies

[Commentary] Here’s a five-step system to create portable consumer subsidies for broadband:

1) Use the Federal Communications Commission’s data to identify all areas unserved by broadband. Census blocks would be considered unserved if they lack broadband as defined by the FCC. Broadband is defined today as an evolving standard consisting of four attributes: speed (currently 25/3 Mbps), capacity (150 GB per month of data or the median household usage), latency (100 milliseconds) and price (median national price).
2) Use the FCC’s Connect America cost model to determine the appropriate level of public funding for each location in each census block. The FCC cost model was developed over many years with the cooperation of the nation’s telephone companies to calculate the cost of constructing, maintaining and operating fiber-to-the-premise networks. The FCC has used this model to calculate a level of subsidy necessary to build and provide service to every location in every census block throughout the country.
3) Make available such support to all internet service providers (ISPs) that are certified in states as eligible telecommunications carriers (ETC). The count of each ETC’s subscribers should only include broadband service and should be limited to one subsidy per location, similar to the limitation of the Lifeline program of one subsidy per household.
4) Every six months, when ISPs submit data to the FCC indicating geographic area, speed, technology and numbers of customers, each eligible telecommunications carrier that wishes to participate in the Connect America Fund would submit their data to the Universal Service Administrative Company. The fund administrator would compensate each carrier based upon the number of locations served with broadband and the subsidy per location per census block. The FCC would also continually update its information on where services were provided without the use of a subsidy in order to eliminate those areas from further public funding.
5) Any ISP could win back a customer it loses, and thereby win back the subsidy amount. This will encourage ISPs to continue to improve service offerings even in rural areas, and allow public funds to follow ongoing consumer decisions, rather than pre-set government decisions. Whether the service chosen is fiber-based, copper-based, wireless (fixed or mobile), satellite, drone or balloon, the FCC would get out of the business of determining the type of technology and attempting to compare the relative weights of technologies.

[Chambers is a partner at Conexon, LLC, a company dedicated to working with electric cooperatives interested in serving their members with broadband]