Broadband policy – local, state or federal?

This year (2019) I have seen a greater examination of policy from local and national perspective – specifically people asking, which makes sense? There was the Charter case in Minnesota, where the FCC said the state was overstepping boundaries to step in with a decision…

The new court ruling found that Minnesota‘s state government cannot regulate VoIP phone services offered by Charter and other cable companies because VoIP is an “information service” under federal law. 

The FCC was quick to compare that case to state attempts to introduce Net Neutrality legislation…

Pai argues that the case is consistent with the FCC‘s attempt to preempt state-level net neutrality rules, in which the commission reclassified broadband as a Title I information service instead of a Title II telecommunications service.

A Minnesota version of Net Neutrality was introduced earlier this month. Several broadband providers showed up for the hearing; most were agreeable to the principles of Net Neutrality but felt it was a federal, not state issue.

Last week, Sen Tomassoni introduced a bill to prevent/prohibit robo-calling; the bill has been moved to the Committee on Judiciary but during the meeting someone did ask if this was a state or federal issue.

It’s difficult because by its very nature, broadband is a network. It’s only as strong or weak as it’s strongest/weakest link. The network crosses boundaries and connects nodes that are local, state and federal. In Minnesota, through the broadband grants and the Office of Broadband Development, we have found a way to encourage projects that include local, state and federal solutions. There are several examples of local communities working to apply (or apply jointly with a provider) for state funding to deploy a local networks. There are a few projects (Sunrise Township for example) where federal (CAF II) has been used to match state funding and state requirements have been used to improve the networks built with CAF II money. So there are examples of local, state and federal policies (and funding) working together to create better solutions for the consumers.

Blair Levin asks a similar question a recent article – Mayors or the FCC: Who understands the broadband needs of metropolitan residents? He uses discussions between the mayor of San Jose, Calif., Sam Liccardo, and the FCC commissioner, Brendan Carr to make a case…

The mayor negotiated deals with Verizon and AT&T that commit all sides to actions that assist carriers deploying network facilities, provide benefits to all related Internet of Things applications, and support the city’s efforts to narrow the digital divide and invest in more efficient administration.

By contrast, the commissioner pushed the FCC to adopt an order to preempt local government authorities around where and how quickly broadband providers could install 5G small cell towers. The order raises the costs for cities, forcing them to allocate new resources to meet federal timetables for a single, favored form of construction. It even regulates the price that cities can charge for accessing city property, taking money from cities and transferring it to carriers.

What did the commissioner ask from the carriers? Nothing. In exchange for price reductions on existing uses of the cities’ property—a gift estimated to be worth $2 billion nationwide—the carriers have no obligation to do anything.

Commissioner Carr’s arguments in his op-ed were unlikely to persuade San Jose residents of the benefits of his approach. He asserts that if carriers save money building networks in San Jose, they will spend it by deploying networks elsewhere, thereby accelerating availability of 5G services throughout the country. It’s a curious argument. Why should San Jose residents care or be forced to subsidize network construction outside their city?
But even from a national perspective, Commissioner Carr’s arguments are factually flawed. Market signals confirm the FCC order won’t lead to accelerated investment. As the CFO of Verizon said on a call with investors, “I don’t see it [the FCC’s order] having a material impact to our build out plans. We are [already] going as fast as we can.” Further, since the FCC order, the wireless industry has actually reduced its plans for capital investment. As additional evidence of the flaws in the FCC’s order, it provided no data or explanation to explain why a carrier would prioritize the use of its savings any different than it uses any other additional money. That is, the money is more likely to be used for purposes such as stock buy backs, dividend support, or deleveraging than new capital investments.

Levin raises some good points. But I’m reading this situation from a rural perspective. San Jose is a tech-heavy city. There is a market potential in providers making concessions to come into the area. San Jose doesn’t need the support of federal policies. And the article makes the point that the policies intended to help extend the reach and investment in technology aren’t working. Either way, San Jose will most likely see 5G. But what about 8 miles outside the San Jose, will they? What about communities in rural Minnesota, will they?

Is there a way that federal, state and local policies can work together, as they have with the Minnesota model or grants and more realistic speed goals? The FCC wields a certain power. Can we get them to work with Mayors (I would add County Commissioners) and State voices to create the carrots or the sticks required to encourage providers to extend, expand and improve broadband in areas where market case isn’t as easily made? It seems like the more local the voice, the strong aligned it is with the consumers/residents at the front line. While the federal voice has the expertise in the technology of broadband and the power to make things easier for communities and providers – but eliminating the need for each community to recreate the wheel but that only works when the wheel drives everyone forward.

This entry was posted in MN, Policy by Ann Treacy. Bookmark the permalink.

About Ann Treacy

I have a Master’s Degree in Library and Information Science. I have been interested or involved in providing access to information through the Internet since 1994, when I worked for Minnesota’s first Internet service provider. I am pleased to be a part of the Blandin on Broadband Team. I also work with MN Coalition on Government Information, Minnesota Rural Partners, and the American Society for Information Science and Technology.

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