What Service Providers Need to Know About the National Broadband Plan

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.