I have a thought-provoking post from Gary Fields to share today. For several years Gary worked with the Blandin Foundation on broadband policy but more recently he has been focused on FTTH in Lake County and other rural areas.
The 4 D’s of Incumbent Telco Public Policy by Gary Fields
After spending over 30 years in different positions in economic development finance, I recently found myself at ground zero in the public policy debate over broadband development. Seven years ago I started working to help start a public policy initiative focused on rural broadband development after I convinced them that this issue is critical to rural economic development. During the five years where I managed the discussions by a group of senior representatives from the consumer and provider sectors, I was regularly frustrated by the strategies and tactics deployed by the providers to impede any significant progress in this critical area. I decided that what rural areas needed most of all were some good alternatives models for developing FTTP networks and have focused most of my efforts there in the last few years.
Just recently I had the opportunity to participate in the State of Minnesota Ultra High Speed Broadband Task Force, a public policy effort similar to my earlier efforts, but with more official State authority and legislation behind it. I was shocked to see the same strategies and tactics utilized by the provider representatives. At the same time, I have observed actions conducted by the FCC and recognize the same influences. To help others engaged in these important public policy discussions I decided to prepare a summary of the tactics deployed by providers to help facilitate a more constructive effort. With perseverance and diligence we may yet reclaim our global leadership role in telecommunications service and reap the economic benefits that position will bring.
Incumbent providers, like most businesses, are focused on relatively short term economic performance, typically 1-5 years. Investment in new telecommunications infrastructure, such as community wide fiber-optic networks, can only meet longer term investment objectives. Service providers make maximum short term profits by avoiding long term investments and squeezing every dollar from their rapidly aging copper-based networks. To avoid any pressure from the consumer and public sectors to upgrade their infrastructure to meet global standards (at the expense of local economic competitiveness), they have deployed the “4 D’s of Incumbent Telco Public Policy”.
1. Deny! Deny that there is a problem. “What lack of service? Who really needs more speed and bandwidth? If someone really wants more speed, we can deliver it (at high prices).” (Note: in the 50’s the Railroad industry fought long, hard and bitterly against building the interstate highway system and city-owned airports. A major argument was: “who needs this? The country is already adequately served by high speed transportation.” Sound familiar?) One can reinforce the low demand for higher bandwidth if high prices are maintained and you don’t mention that consumers in the US pay much more per megabit than our global competitors, even the low density countries. It helps if you can get the FCC and others to define “broadband” in the slowest possible terms so that you can say that everyone has “broadband”. US definitions of broadband are laughable when compared to international standards. When “Deny” no longer works, there are always the other 3 D’s.
2. Delay! If you can’t get everyone to agree that the problem doesn’t exist and go home, the next tactic is to delay any activity that could ultimately encourage investment. The best option, “Let’s study it! Where does the problem exist? How does one community compare to another? Who, exactly is underserved (again, by ridiculously low standards)?” You can delay any action for a year or two by generating meaningless studies. Most of the US in underserved when compared to our global competitors. Creating a map of different inadequate service providers does not help us. But if you can delay with a study that is conducted by organizations that are controlled and funded by incumbent providers, you might be able to get back to tactic #1 – Deny!
3. Diminish! If it appears that some progress must be made, then it is time to diminish expectations. If the policy group wants a goal like putting a man on the moon, let’s settle for a trip to the 7-11. How about achieving broadband speeds in 2015 that will likely be obsolete by 2011. The bottom line is to establish objectives that are higher than today’s current slowband service, but can be achieved without replacing the copper-based infrastructure.
4. Distract! If you cannot Deny, Delay or Diminish, it is time to Distract, otherwise known as “Let’s change the subject!” “The problem is not slow speed, it is lack of computers in homes. Or too many kids downloading music. Or computer gamers. Too much pornography.” There are many public policy issues related to inadequate broadband service. And make no mistake, they are valid and important. But we will never upgrade our networks to where we need to be if we don’t stay on task. It is easy to be distracted by some of these very emotional and related issues. Let’s keep our eye on the ball!
So if you are engaged in local, state or national broadband policy discussions, please be aware of these tactics. Be bold. Be brave. Be aware!
Gary Fields is the Chief Financial Officer of National Public Broadband, Inc.