Part one of our three  part National Broadband Plan Series focuses on the plan’s ambitious goals and potential implementation challenges

Drafted by a team assembled by the Federal Communication Commission, the National Broadband Plan is a series of policy recommendations aimed at increasing the availability and use of broadband in the U.S.  When the plan was released in mid-March, it garnered wide praise from nearly every corner of the telecom industry.

Writing in a Business Week editorial, Cisco Systems CEO John Chambers said, “Making broadband a national priority will help us become more competitive globally and help us see firsthand how new jobs, businesses, and even new business models can be enabled by access to faster Web connectivity.”

Chambers likened the government’s involvement in broadband planning to its role in promoting the use of electricity a century ago. “Electricity was a game-changer at the start of the 20th century, but for everyone to benefit the government had to get involved,” he wrote. “So we are at a similar inflection point with our digital networks.”

But despite widespread industry acceptance, some aspects of the plan have come under fire. Some elected representatives have questioned whether the FCC has the authority to implement a recommendation aimed at transitioning today’s voice-centric Universal Service program to a broadband-focused program. And individual segments of the industry have challenged specific aspects of the plan. Small rural telcos that receive Universal Service funding today have questioned some of the proposed reforms, for example, and major wireless carriers are likely to challenge proposed roaming reforms.

The National Broadband Plan also has been criticized by those who oppose government spending—although the plan crafters argue that the net effect of the plan, which proposes several spectrum auctions, will be to generate new funding sources for the government.

In this three-part series, Telecompetitor will review the major National Broadband Plan recommendations and the policy issues that they raise, looking at the pros and cons of each recommendation.  Part One focuses on the major goals of the program and what would be required to implement them from a policy and funding standpoint.

Key elements of the National Broadband Plan and funding requirements

The National Broadband Plan was created at the request of Congress. Some policy makers had become increasingly concerned that the U.S. was falling behind other countries in broadband adoption and speeds.

“Several years ago, not having broadband could have been thought by some to simply be an inconvenience,” FCC Chairman Julius Genachowski told a U.S. House of Representatives subcommittee in March. “Now broadband access and digital literacy are essential to participation in our economy and our democracy.”

The National Broadband Plan offers ideas and recommendations about how to increase broadband deployment and use in four ways. These include ensuring robust competition; ensuring efficient allocation and management of spectrum and other assets; reforming current universal service mechanisms to support broadband; and taking steps to maximize the benefits of broadband in public education, health care, government operations and other sectors that are strongly influenced by the government.

Included in the latter category is a plan to construct a nationwide broadband wireless public safety network and a recommendation that Congress raise $6.5 billion to help construct the network. The plan also says Universal Service goals could be achieved more quickly if Congress would appropriate “a few billion dollars” over a three-year period to augment funds raised using the existing Universal Service funding mechanisms, which require carriers to pay a percentage of revenues into the fund.

Offsetting the additional funding requested for the public safety network and Universal Service is a plan to raise money through spectrum auctions. The plan recommends three auctions within the next five years which would likely bring in billions of dollars according to the plan crafters.

Whether or not Congress provides the requested funding, it also would need to take action to implement several other plan recommendations. For example, legislation aimed at protecting energy data would likely be needed before the plan’s recommendations about creating a smart grid system could be implemented. Congress also may be called upon to clarify the FCC’s authority in order to enable the commission to implement some of its recommendations—a topic that will be explored further in Part 2 of this series.

Most of the work in implementing the plan falls on the FCC—a process that is expected to take years. The commission made a start in April when it issued several notices of proposed rulemaking and notices of inquiry to support various plan recommendations. Ultimately at least five dozen separate FCC actions are expected before the plan’s recommendations can become reality.

Long-term goals

The plan also contains six long-term goals targeted for implementation within 10 years—although the plan does not include details about how the goals would be achieved.

Of these, the one that has generated the most discussion is the “100 squared” initiative, which aims to see 100 million households with 100 Mb/s download speeds (and upload speeds of at least 50 Mb/s) within 10 years. That’s more than 90% of today’s households and would represent a substantial gain in both subscribership and bandwidth.

Just under two-thirds of U.S. households subscribe to broadband today, according to the U.S. Census Bureau. and about seven million Americans do not have access to broadband, according to the FCC. The average connectivity speed today is in the range of 3.9 Mb/s to 7.12 Mb/s, depending whose estimate is used.

But as FCC Commissioner Robert McDowell noted during the March 16 plan unveiling, the 100 Mb/s goal is not as ambitious as it might initially seem. “Merely by upgrading cable systems with the DOCSIS 3.0 system, which is expected to happen over the next few years anyway, over 104 million American homes will have access to speeds of up to 100 Mb/s,” McDowell said.

Cable companies have an advantage because the coaxial cable they use to connect individual homes can support substantially more bandwidth than the twisted pair copper wiring that telcos use for the last mile link. Using today’s technology, telcos would need to install fiber to the home to support 100 Mb/s speeds. But moving forward, they too may find new avenues for delivering 100 MB/s service. Alcatel-Lucent recently demonstrated a new form of digital subscriber line technology known as DSL Phantom Mode, that can support 100 Mb/s connectivity (at least in the lab) over distances as great as one kilometer, according to the company.

Another of the six long-term goals also pertains to connectivity—but rather than looking at bandwidth available to end users, it focuses on bandwidth available to community anchor institutions such as schools, hospitals and government buildings. The plan sets a goal of providing every American community with affordable access to at least 1 gigabit per second download speeds for such anchor institutions. But it does not provide any commentary about how that goal would be achieved.

The other four long-term goals are not so easily quantified—and some of them duplicate goals already spelled out in other parts of the plan. These include providing affordable broadband access to all Americans, seeing the U.S. lead the world in mobile innovation, ensuring that first responders have access to a wireless nationwide public safety network, and giving every American the ability to track and manage their real-time energy consumption via broadband.

Part Two of this series will look at proposed Universal Service reforms aimed at bringing download speeds of 4 Mb/s to virtually every American within 10 years and to create a mobility fund to help boost 3G deployment. Part Three will look at plans to free up 500 MHz of spectrum within that same time period to support mobile broadband. Make sure you don’t miss the rest of this series – subscribe to our newsletter, follow us on twitter, or sign up for our RSS feed.

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9 thoughts on “What Service Providers Need to Know About the National Broadband Plan

  1. Overall, it's good to see the FCC come up with a plan. As with everything, the devil's in the details.

    In reference to the USF shift to broadband, it has the potential to go either way. If in the shift, they capture ALL costs relative to a study area for broadband, it could potentially work. But if they don't capture all costs for an apples to apples comparison, relative to the selection of who gets connect america funding, the outcome could be the opposite of what they're looking for – reduced, and in some cases, no investment in broadband for high cost areas.

  2. With a shift of USF to CAF, a 4MB goal, and talk of using models and reverse auctions, it looks like a race to the bottom for rural America. I will predict 4 MB will be wireless, most of the CAF money will go to AT&T/Verizon/Clearwire or smaller wireless providers, and 4 MB will look like dialup a couple years from today if application developers are writing programs for 100 MB connectivity in our urban economic centers. The CAF money will not go to meaningful infrastructure that can support the broadband speeds we will all need and the broadband speeds that our global competitors are deploying today. This plan gives a short-term shot in the arm for unserved areas, but lacks the foresight and commitment to bring globally competitive Universal Broadband to our country. We will need outstanding wire/fiber and outstanding wireless infrastructure to meet our needs and to truly be the world's most productive and most outstanding economy in the years to come. Much of rural America will be put even further behind in education, health care, economic development, and public safety with this plan. This plan is not the solution for rural America and undermines our nation's principles of Universal Service and service comparability.

    1. Greg – you make some good points, but I think you fail to recognize the reality of the situation. The FCC has multiple constituencies/special interests to please. Everybody and their momma has a compelling story to tell. Some legitimate, some profit driven, some status quo clinging, some disruptive hoping, some just plain ridiculous. In this current system, there is no way to please everyone. So what you generally get is a watered down policy that doesn't overly offend any special interest, but doesn't really push the envelope either. I guess it's a consequence of democracy..

      1. We seem to have forgotten how important rural America is to our country as a whole. Just for comparison, our Department of Transportation spends about 70 billion a year. Wouldn't progressive thought be to invest in communications infrastructure that would take people off our roads and save energy costs? I completely understand past realities….I'm just hoping for something better. I think that is what we were promised.

  3. Great insight from the post and its comments. I for one am just glad to see the FCC make the effort to develop the plan. As is the case with any policy move, there will be winners and losers. But from my vantage point, the identified plan is a great starting point. Now I hope the process works, and we end up with a finished plan that can be implemented and truly delivers on universal broadband for the nation.

  4. I hear you Adam. Good points. I know there are multiple constituencies and special interests involved, but I do think think the FCC is "trying" to do the right thing. I have been impressed with the development of the plan and agree that this is a step in the right direction as a model for government. They cannot be immune to all interests involved but I am not as skeptical of the process as you seem to be. However, I do think they have missed the mark by effectively creating two definitions of broadband. Broadband is 100 Meg in urban America and 4 Meg in rural America. It would be similar to our existing policy being single line voice service in urban America and 10 party line service in rural America. I understand the economics of making a committment to rural America, but trying to cut money out of an industry-financed program that will lead to economic development and jobs in rural America seems misplaced to me.

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