Friday, November 1, 2024
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Silicon Valley vs. American politics
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FCC and the broadband industry argue net neutrality’s future
Could the Election Revive the Affordable Connectivity Program?
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Some see Federal Communications Commissioner Brendan Carr, the agency’s senior Republican, as the most likely candidate for chairman of the agency under a second Trump presidency. What would he do if Trump won, and if Carr were selected for the job? Carr actually outlined his priorities for broadband and telecommunications policy in a chapter of the Heritage Foundation’s Project 2025 policy agenda. The widely available document has been highly criticized by opponents of former President Donald Trump during the presidential campaign: Trump and his campaign have disavowed it. “The FCC’s prior reforms focused on streamlining the rules for small wireless facilities,” Carr wrote of broadband deployment. “The FCC should now explore similar action for the deployment of other wired infrastructure by imposing limits on the fees that local and state governments can charge for reviewing those wireline applications and time restrictions on the government’s decision-making process.”
When millions of Americans cast their ballots on Election Day, the Affordable Connectivity Program won't be up for a vote, but the results could dictate whether we see an internet subsidy of its size again. The ACP was passed in 2021 as part of the Infrastructure Investment and Jobs Act, when Congress dedicated $14.2 billion to making the internet more affordable to low-income users. It gave low-income users $30 each month toward their home internet costs (or $70 for those living on tribal lands). By the time it ended in May 2024, the ACP had enrolled more than 23 million households, including more than 10 million veterans. Since it expired in May, several ACP extension bills have been introduced in Congress, but none have made it out of committee, even though the program is widely popular among voters. Some policy insiders attribute that to election year politics.
Tech-world insiders are getting more involved than ever in national politics this year—and it’s not just Elon Musk. But as the presidential election looms, there’s a major disconnect between American politics and Big Tech when it comes to their visions of America’s future. On the campaign trail, Vice President Kamala Harris talks about the risk of “more chaos,” incipient fascism and a quick, steep slide back to the gender politics of the 1950s. Meanwhile, the retrograde cultural assumptions of former President Donald Trump’s platform were on full display at Madison Square Garden. Meanwhile in Silicon Valley, AI entrepreneurs promise a world where there’s little to be afraid of (except maybe overregulation) — and nostalgia is nothing but a brake on a future we should be ushering in as quickly as possible. The mismatch between the mindset driving tech—the engine of America’s prestige and global economic dominance—and the mindset driving American politics has never been sharper, and it’s upending technopolitics on the campaign trail.
Artificial intelligence, like everything else in the U.S. on the threshold of a historic election, faces a fork in the road on Election Day. A victory by Vice President Harris is likely to mean new life for the Biden administration's careful approach to AI regulation, which she has overseen. Meanwhile, former President Trump hasn't said much about AI—but if he wins, Elon Musk does, too. A new Harris administration would likely pursue a middle-of-the-road AI agenda in the vein of Biden's 2023 executive order. A second Trump term would lay out a much more volatile scenario for AI. We do know one thing—Elon Musk, who is raising billions for his xAI startup, would almost certainly gain additional sway.
Biden-Harris Administration Approves and Recommends for Award New York’s Digital Equity Capacity Grant Application for More Than $36 Million
The Department of Commerce’s National Telecommunications and Information Administration (NTIA) has approved and recommended for award an application from New York, allowing the state to request access to more than $36 million to implement its Digital Equity Plan. This funding comes from the $1.44 billion State Digital Equity Capacity Grant Program, one of three Digital Equity Act grant programs created by the Bipartisan Infrastructure Law. New York will use its $36,984,641 in funding to implement key digital equity initiatives, including:
- Fund new and existing programs that distribute new and refurbished devices, such as computers or laptops
- Fund tech support programs as a job-readiness pathway
- Develop digital safety trainings that protect against stolen data, scams, surveillance and online harassment
Broadband is one of the last remaining, truly bipartisan issues, according to Chip Pickering, the CEO of Incompas. Pickering said there might be a movement in Congress to restore and modernize broadband subsidies to help low-income earners afford services. “It is a national consensus and commitment of connecting every American,” said Pickering, who also served for 12 years in Congress representing Mississippi’s 3rd congressional district. Pickering said direct appropriations could be an answer to modernizing the Universal Service Fund, which has come under siege in recent court rulings, and he held out hope for a renewed effort to restore the Affordable Connectivity Program (ACP). Brian Worthen, the CEO of Visionary Communications, elaborated on the need for a program like the ACP to exist. “You can’t, as a provider, build entirely to low-income areas because your take rate is 10, 15, 20 percent less than a more affluent area,” he said.
AT&T subsidiary Wisconsin Bell last recently reiterated its argument to the Supreme Court that telecommunications companies should not be hit with tougher fines for fraudulent reimbursement requests to a major broadband subsidy program. The company is seeking to overturn a Seventh Circuit ruling that found the False Claims Act applies to reimbursements from the E-Rate program, a broadband subsidy for schools and libraries funded by the $8-billion-per-year Universal Service Fund. The act calls for damages tripling the amount of fraudulently obtained government money, plus mandatory civil penalties. “What matters under the FCA is that requests for money supplied by private carriers to a private corporation pose no risk of loss to the government,” Wisconsin Bell wrote in an Oct. 24 reply brief.
On Light Reading's The Divide, Shirley Bloomfield, CEO of NTCA—The Rural Broadband Association, talks to host Nicole Ferraro about the fallout from the fifth circuit court's ruling this summer on the constitutionality of the Universal Service Fund (USF) and what comes next. They also discuss why the USF—which funds high-cost and low-income broadband programs like Lifeline, E-Rate and more—is crucial for rural service providers, families and students, and what would happen if it went away.
With a federal court recently declaring the funding mechanism for a major low-income connectivity program unconstitutional, telecommunications policy experts are actively discussing alternative solutions to keep essential broadband programs funded. Roslyn Layton, executive vice president of Strand Consult, met with the Federal Communications Commission to propose expanding the $8.1 billion Universal Service Fund’s funding base in a way that avoids the financial burden falling on consumers. Layton said contributions from industries that benefit from broadband networks—such as cloud computing, software as a service (SaaS), and digital advertising—would establish a sustainable $15 billion annual fund to support both the USF and the Affordable Connectivity Program.
Subsidies like the Affordable Connectivity Program (ACP) are unaffordable and set communities up for failure, according to Eric Sasaki, the manager of major programs at L.A. County’s internal services department. To address the digital divide in Los Angeles County, Sasaki said the county has chosen another path. “We were very flexible in terms of how we approached our model,” Sasaki said. Sasaki, who runs Los Angeles County’s community broadband initiative, said the track record of subsidies like the ACP provided lessons to learn from. LA County’s community broadband initiative, instead, was designed to accelerate digital equity by using public-private partnerships that can provide low-cost home internet access in areas where more than 20 percent of homes are without a broadband internet subscription.
Attorneys for the Federal Communications Commission and groups representing the broadband industry argued about the future of net neutrality to a panel of appeals court judges on October 31. The hearing was part of an endless political ping-pong game over net neutrality rules—which reclassify internet service providers (ISPs) as common carriers, barring them from selectively throttling web traffic. After being enacted under President Barack Obama and repealed under his successor, Donald Trump, they were reinstated by Joe Biden’s FCC in April. The latest iteration didn’t get far since the Sixth Circuit Court of Appeals put the rules on hold while it considers the case. Much of the hearing focused on the significance of the “major questions” doctrine, which says Congress must explicitly grant agencies the power to make certain decisions, and the end of a doctrine known as Chevron deference, which instructed judges to defer to agency expertise. In a post-Chevron world, courts have far more liberty to make their own determinations about whether a policy like net neutrality should exist. While net neutrality has always faced its challenges, these changes make its path to implementation even harder.
In what is bad news for many other internet service providers (ISPs), both T-Mobile and Verizon have plans to continue their aggressive growth of FWA cellular broadband. As a reminder, this is home broadband delivered from cell towers that mostly uses the same spectrum already being used at cell towers for cell service. AT&T, T-Mobile, and Verizon have had unprecedented success with this new broadband product since it first launched in 2021. If the three companies meet their growth goals, they will collectively have almost 20 million broadband customers in 2028—almost as big as Charter or Comcast today. This growth is by far the biggest disruption of the traditional broadband industry, with FWA growth taking customers away from all other ISPs.
Not only does fiber increase the power and capability of the home, but it also adds to the overall value of the real estate and its ability to be sold more quickly as buyers look for reliable high-speed broadband for work-from-home, telehealth, gaming, streaming, and smart home devices such as security cameras and personal assistance. According to Adtran, consumer needs for more broadband are growing every year. U.S. Internet adoption has increased to 81% of households, telehealth popularity has doubled year-over-year since 2020, e-commerce is expected to reach $8.1 trillion by 2026, and in-home devices have increased to 22 per home in 2024. Additional research from Adtran shows both business and residential consumption have increased since 2017, with an overall 21.2% CAGR for residents. By enabling all of these applications to be run on high-speed, low-latency broadband, fiber increases the value of the home, according to platforms such as Doorify MLS. The MLS service, the 33rd largest in the U.S., provides competing real estate and brokers to share information about houses, land, and buildings, such as size, amenities, and internet access.
The Federal Communications Commission's next open meeting will focus on guarding against tricks—from possible attacks on undersea communications infrastructure to unwanted robocalls. Here’s everything we have lined up for our November agenda.
- We’re updating security for vital infrastructure. Dozens of systems of submarine cable serve as the backbone of our domestic and global communications networks. Over the past two decades, the technology, economics, and security challenges involving these systems have greatly changed, but FCC oversight has not. The Commission will vote to undertake the first major comprehensive review of our submarine cable rules since 2001.
- We’re continuing to bolster our defenses against robocalls. One of our most effective tools for mitigating deceptive robocalls is the STIR/SHAKEN caller ID authentication framework, which allows service providers to verify that the caller ID information you see on your phone is legitimate. Some providers rely on third parties for STIR/SHAKEN implementation, which has raised concerns about improperly authenticated calls and diminished accountability. To ensure the integrity of the framework, the Commission will vote to establish clear rules of the road for the use of third parties in the caller ID authentication process.
- We’re enabling customized content for FM radio audiences. By using booster stations to air programming different from their primary station, FM broadcasters can now deliver customized content to specific parts of their service areas. In April 2024, the Commission authorized FM broadcasters to use boosters to originate this so-called “geo-targeted” content on an experimental basis. We consider rules to enable this tailored content on a more permanent basis.
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), Grace Tepper (grace AT benton DOT org), and Zoe Walker (zwalker AT benton DOT org) — we welcome your comments.
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