In 2nd Round of Broadband Comments, Industry Resists Government Intervention

“The federal government should not hinder private-sector investment in broadband infrastructure with net neutrality or similar regulations,” said the U.S. Chamber of Commerce. “Unless a market failure has occurred and consumer harm will result, policymakers should refrain from intervening.”

Big phone and cable companies agreed. “A handful of commenters seek to reopen long-settled regulatory controversies by calling for the re-regulation of markets that Congress directed the Commission in 1996 to keep unregulated,” AT&T said. “But these backward-looking proposals would do nothing to promote, and much to thwart, the overriding objectives of the National Broadband Plan.” Instead, said Comcast, the FCC should pursue policies encouraging private investment in unserved areas, upgrades in network speed and bandwidth and improvements in security online.

But a hands-off policy doesn’t guarantee access to broadband, warned the National Association of State Utility Consumer Advocates. “Some commenters would have the Commission continue, or even expand, past deregulatory policies as the primary means of promoting broadband deployment, essentially arguing that continuing a ‘hands-off’ approach will ensure the least costly way to provide adequate and ubiquitous broadband access for consumers,” the association said. “While regulatory flexibility to encourage private sector decision-making, innovation and experimentation is appropriate, government intervention in the broadband market is nonetheless essential and should be focused on ensuring deployment to areas that are unserved or underserved and overcoming barriers to consumers’ broadband adoption.”

Free Press said regulation would in fact encourage investment. “Blind deregulation … has proven to be an epic failure for American consumers and the American economy,” it said. “Regulations that keep market power in check are designed to make the telecom market -- a market that has natural monopoly qualities -- work more like the textbook free market. Without rules, the game is rigged in favor of the entrenched incumbents, and consumers lose.”

The Free State Foundation criticized calls for regulation. “These commenters have a very strong anti-market bias that leads them presumptively to favor … more government control over the communications marketplace,” it said. “Free Press and its allies refuse to credit” the U.S. with any progress on broadband, “preferring instead to talk broadband down as a means of supporting their calls for a public utility regime.”

Many responded sharply to the gloomy picture of broadband painted in some initial comments. “The sky is not falling and reports of our national broadband demise have been greatly exaggerated,” said the Progress & Freedom Foundation, cautioning the FCC against “rash action” that could discourage investment. “Too many of the first-round comments … suggested that broadband in America is an unmitigated failure,” said the Internet Innovation Alliance. “Such a dim view of our current status could prompt policy makers to seek radical course changes that undermine much that is going right.”

Verizon said the U.S. “has made much progress in extending the reach and capabilities of broadband technology in a relatively short time, and consumers have responded by adopting broadband at a rapid clip.” More than 90 percent of Americans have access to wireline broadband, it said.

But Skype said the broadband plan’s “primary goal … should be to rectify policy gaps to address areas where networks can be more efficiently utilized and to protect the ‘consumer experience,’ including consumer rights to open networks, devices, services, applications, and content.”

Alcatel Lucent said the U.S. can’t simply impose measures such as strict network-sharing requirements based on “their supposed success” in countries with more broadband penetration. “While nations such as Japan and South Korea have undoubtedly made impressive strides, their success owes much to factors such as very high population densities, expansive public subsidies, and the adoption of tax credits and other pro-deployment policies, not to any effort to treat broadband providers as common carriers,” Alcatel said.

New York City compared investment in broadband to the $400 billion in 2009 dollars the federal government spent on the Interstate Highway System between 1958 and 1991. “To achieve a comparable level of ubiquity and ease of access for every citizen to the information transmission network that will be the 21st century equivalent of the roads and highways built in the previous century, a comparable national commitment must be considered.”

Arguments against new net neutrality rules “often seem to assume a very crude or extreme version of regulation,” said the Center for Democracy & Technology. AT&T, for example, worries about banning “all deferential treatment of packets” and the death of content-delivery networks, it said. “But this is a straw man, put forward because it is easier to argue against than the kind of nondiscrimination policy that the nation might reasonably adopt.” A “sensible” policy “would provide leeway” for discrimination “in appropriate circumstances,” it added.

“An appropriate nondiscrimination principle is not about a particular business model or forcing governmental regulations to protect a given company interest,” Google said. “Rather, this principle addresses the matter of whether it is the user or the platform owner that should pick and choose the ‘winners and losers’ in the online content and applications marketplace.” An FCC ban on “anti-user network control practices” would be “a reasonable middle ground” between opposing views on neutrality regulation, said Google. “Reasonable network practices that are limited to ensuring network security and to complying with the requirements of law enforcement should be expressly permitted.”

Wireless Weighs In

CTIA warned of dangers posed by new regulation. It pointed to the strong growth of wireless especially the past 18 months. “As CTIA has stressed to the Commission, wireless is not a third broadband pipe into the home, but rather broadband to the person, wherever they are, whenever they want access to information,” the association said. “Going forward, all discussion involving broadband, whether at the Commission or in Congress, should be based on the notion of facilitating broadband to the person.”

But the wireless industry needs changes to keep progressing, CTIA said. These include granting the group’s “shot clock” petition to guarantee timely siting of wireless facilities, the identification and allocation of additional spectrum for licensed use, and action aimed at accelerating carriers’ access to AWS-1, 700 MHz spectrum and other bands assigned but still being used for previous purposes.

PCIA called tower-siting delays “the primary barrier depriving Americans of the full potential of wireless services.” The group endorsed a time limit on tower decisions. “The Commission should not and need not wait for Congress to act to improve wireless infrastructure siting because it has the power under the Communications Act to ensure that zoning decisions are made in a reasonable timeframe,” PCIA said. The Chamber said: “Over 240,000 cell sites have been deployed by wireless carriers as of December 2008, according to CTIA. For full 3G mobile broadband coverage, approximately 16,000 new sites will need to be constructed and 55,000 existing sites will need to be upgraded.”

Don’t blame local governments for the pace of extending broadband, countered the National Association of Telecommunications Officers & Advisors, which filed joint replies with many local governments and other interests. “In light of all the compelling local interests in promoting access to advanced broadband, it is troubling to hear industry complaints that localities create the barriers to the deployment of broadband networks,” the association said. “These unsupported claims are based on the absurd premise that local communities are not interested in competition that will lead to advanced broadband services, lower prices, and greater adoption.”

Other filers also said the FCC should make more spectrum available. The Telecommunications Industry Association called for a spectrum inventory, to see what’s available. “With widespread agreement that a spectrum inventory is the first step to advancing wireless broadband availability and technologies, such an inventory should be performed quickly and possibly in coordination with the NTIA’s effort to create a broadband map by February 2011 as required by the Recovery Act,” the association said. “Were the NTIA and the Commission able to work toward the broadband mapping and spectrum inventory initiatives together, it is reasonable to believe that both can be completed by February 2011.”

“Many commenters agree with Qualcomm that more licensed spectrum, to be made available via auctions, is necessary to fuel the burgeoning growth in demand for mobile broadband,” Qualcomm said. “New spectrum bands are not at the Commission’s fingertips. The same interagency process, with Congressional direction and support, by which the spectrum now known as the PCS and AWS-1 bands were identified, reallocated from federal government to private use, and then cleared of incumbents, should begin again as soon as possible.”