FCC Broadband Plan Shrivels Compared To New Hampshire

Last March, the FCC announced a national broadband plan with the goal of connecting ~85 percent of the US population to 100 Mbps high speed broadband by 2020. I just learned that New Hampshire is requiring that North Carolina-based FairPoint* (which paid $2.3 billion for Verizon’s New England land lines and internet service) is required to offer broadband service to 95 percent of its customers by 2013.

It’s true that the NH requirement contains no speed threshold. However, broadband speeds have been increasing by 50 percent a year for the past decade. Therefore, assuming that FairPoint keeps up with the technology – or even lags a little – they should be at 100 Mbps by 2010, given that the US average was 5 Mbps last March:

  • 5 Mbps – 2010
  • 7.5 Mbps – 2011
  • 11 Mbps – 2012
  • 17 Mbps – 2013
  • 25.5 Mbps – 2014
  • 38 Mbps – 2015
  • 57 Mbps – 2016
  • 85.5 Mbps – 2017
  • ~130 Mbps – 2018

I said last year that I thought the FCC plan was lame, based on a comparison with other nations. For example, Australia, with a population density of 7.5 people/square mile, has a goal of 100 Mpbs to 90 percent households by 2018. That’s two years and ~5 percent of its population ahead of the U.S., which has a population density an order of magnitude larger (83 people/square mile).

Now we can see that it’s lame when compared with New Hampshire. Regulators in NH, Vermont and Maine were thinking about their customers when they approved the sale of Verizon assets:

Expanding broadband to rural areas was a major contingency in all three states, allowing tiny FairPoint to swallow up an operation five times its size, a deal that was considered risky. Verizon had long made it clear that it had no plans to invest in New Hampshire, instead focusing its growth efforts on major cities, where it would get a higher return on investment.

The situation in Maine makes it clear that the FCC failed consumers, again, by allowing telephone companies to act like cable companies: they don’t have to share their fiber optic cable.

Last year at this time, FairPoint Communications, our bankrupt phone company, was threatening to disconnect 20,000 Great Works Internet customers [New England’s largest ISP] after jacking up its line rate for unused fiberoptic cable from $50 a mile to $1,100 a mile and then claiming GWI owed it $3 million.

This year, FairPoint is only threatening to disconnect 1,700 GWI customers, those unfortunate few like myself who receive GWI broadband Internet service over a FairPoint phone line. Last year, FairPoint blinked. This year, given the small number of consumers involved, I wouldn’t be surprised if FairPoint makes good on its threat to cut off GWI once the contract between the two companies expires on Feb. 28.

The fiber optic cable is not considered a common carrier infrastructure because it’s for “information services.” Nevermind that today’s telephone service is VoIP, an information service. Nevermind that the rule was argued for by cable companies that wanted to protect their monopoly territory. Funny how teleco/cable deregulation — acts or rhetoric — rarely result in increased competition.

*FairPoint filed for Chapter 11 in 2009, about 18 months after buying Verizon’s land line and Internet assets  in Maine, New Hampshire and Vermont. The deal transformed FairPoint into the seventh-largest phone company in the country. FairPoint operates in 18 states and controls 1.7 million access lines.

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2 thoughts on “FCC Broadband Plan Shrivels Compared To New Hampshire

  1. Hi, Kevin — Me, too.

    But in the mid-90s, what we got instead was the Communications Decency Act, rammed through by a “red” Congress (see balance of power chart). That Act, of course, was struck down by the US Supreme Court.

    I don’t know when the technology was developed that made it possible for a copper line to be “shared” — ie, for someone to have Qwest for local phone service and Sprint for long distance. Look how long it took for the government to get relief:

    In 1974, the Justice Department concluded that microwave technology allowed long distance firms like MCI to compete against AT&T in long distance, but that AT&T had been using its control over the local exchanges to stall competition in that sector. After the Department obtained divestiture relief nine years later through a consent decree, it still required an additional twelve years before sufficient competition took hold so that AT&T’s long distance prices were de-regulated. DOJ

    I agree that there will be capital investment needed by Frontier and FairPoint — but we (“society” – “taxpayers” – “the greater good”) have to figure out a way to fund this infrastructure for the parts of the country that aren’t high-density. And we need to move faster than the historical record — because we have competition today (China) that we did not have in the mid-20th century and because this technology is absolutely central to the economy and to governance.

  2. So, Kathy, let’s be clear about this. If it had been me in the mid-1990s, there would have been a government-assisted broadband plan (with regulation) beyond REA or USF monies. The body politic never warmed up to that and probably because common carriers would have or did lobby against such proposals, among others. Would that have resulted in a faster deployment of such a network? Without a doubt. The recent Frontier transaction with Verizon also requires major investment in expanding the broadband footprint in Washington state. I hope it happens.

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