Wireless & Spectrum Policy

Innovation policy in Arizona

by on June 17, 2021 · 0 comments

I write about telecom and tech policy and have found that lawmakers and regulators are eager to learn about new technologies. That said, I find that good tech policies usually die of neglect as lawmakers and lobbyists get busy patching up or growing “legacy” policy areas, like public pensions, income taxes, Medicare, school financing, and so forth. So it was a pleasant surprise this spring to see Arizona lawmakers prioritize and pass several laws that anticipate and encourage brand-new technologies and industries.

Flying cars, autonomous vehicles, telehealth–legislating in any one of these novel legal areas is noteworthy. New laws in all of these areas, plus other tech areas, as Arizona did in 2021, is a huge achievement and an invitation to entrepreneurs and industry to build in Arizona.

Re: AVs and telehealth, Arizona was already a national leader in autonomous vehicles and Gov. Ducey in 2015 created the first (to my knowledge) statewide AV task force, something that was imitated nationwide. A new law codifies some of those executive orders and establishes safety rules for testing and commercializing AVs. Another law liberalizes and mainstreams telehealth as an alternative to in-person doctor visits. 

A few highlights about new Arizona laws on legal areas I’ve followed more closely:

  1. Urban air mobility and passenger drones

Arizona lawmakers passed a law (HB 2485) creating an Urban Air Mobility study committee. 26 members of public and private representatives are charged with evaluating current regulations that affect and impede the urban air mobility industry and making recommendations to lawmakers. “Urban air mobility” refers to the growing aviation industry devoted to new, small aircraft designs, including eVTOL and passenger drones, for the air taxi industry. Despite the name, urban air mobility includes intra-city (say, central business district to airport) aviation as well as regional aviation between small cities.

The law is well timed. The US Air Force is giving eVTOL aircraft companies access to military airspace and facilities this year, in part to jumpstart the US commercial eVTOL industry, and NASA recently released a new study (PDF) about regional aviation and technology. NASA and the FAA last year also endorsed the idea of urban air mobility corridors and it’s part of the national strategy for new aviation.

The federal government partnering with cities and state DOTs in the next few years to study air taxis and to test the corridor concept. This Arizona study committee might be to identify possible UAM aerial corridors in the state and cargo missions for experimental UAM flights. They could also identify the regulatory and zoning obstacles to, say, constructing or retrofitting a 2-story air taxi vertiport in downtown Phoenix or Tucson.

Several states have drone advisory committees but this law makes Arizona a trailblazer nationally when it comes to urban air mobility. Very few states have made this a legislative priority: In May 2020 Oklahoma law created a task force to examine autonomous vehicle and passenger drones. Texas joined Oklahoma and Arizona on this front–this week Gov. Abbot signed a similar law creating an urban air mobility committee.

  1. Smart corridor and broadband infrastructure construction

Infrastructure companies nationwide are begging state and local officials to allow them to build along roadways. These “smart road” projects include installing 5G antennas, fiber optics, lidar, GPS nodes, and other technologies for broadband or for connected and autonomous vehicles. To respond to that trend, Arizona passed a law (HB 2596) on May 10 that allows the state DOT–solely or via public-private partnership–to construct and lease out roadside passive infrastructure.

In particular, the new law allows the state DOT to construct, manage, and lease out passive “telecommunication facilities”–not simply conduit, which was allowed under existing law. “Telecommunication facilities” is defined broadly:

Any cable, line, fiber, wire, conduit, innerduct, access manhole, handhole, tower, hut, pedestal, pole, box, transmitting equipment, receiving equipment or power equipment or any other equipment, system or device that is used to transmit, receive, produce or distribute by wireless, wireline, electronic or optical signal for communication purposes.

The new Section 28-7383 also allows the state to enter into an agreement with a public or private entity “for the purpose of using, managing or operating” these state-owned assets. Access to all infrastructure must be non-exclusive, in order to promote competition between telecom and smart city providers. Access to the rights-of-way and infrastructure must also be non-discriminatory, which prevents a public-private partner from favoring its affiliated or favored providers. 

Leasing revenues from private companies using the roadside infrastructure are deposited into a new Smart Corridor Trust Fund, which is used to expand the smart corridor network infrastructure. The project also means it’s easier for multiple providers to access the rights-of-way and roadside infrastructure, making it easier to deploy 5G antennas and extend fiber backhaul and Internet connectivity to rural areas.

It’s the most ambitious smart corridor and telecom infrastructure deployment program I’ve seen. There have been some smaller projects involving the competitive leasing of roadside conduit and poles, like in Lincoln, Nebraska and a proposal in Michigan, but I don’t know of any state encouraging this statewide.

For more about this topic of public-private partnerships and open-access smart corridors, you can read my law review article with Prof. Korok Ray: Smart Cities, Dumb Infrastructure.

  1. Legal protections for residents to install broadband infrastructure on their property

Finally, in May, Gov. Ducey signed a law (HB 2711) sponsored by Rep. Nutt that protects that resembles and supplements the FCC’s “over-the-air-reception-device” rules that protect homeowner installations of wireless broadband antennas. Many renters and landowners–especially in rural areas where wireless home Internet makes more sense–want to install wireless broadband antennas on their property, and this Arizona law protects them from local zoning and permitting regulations that would “unreasonably” delay or raise the cost of installation of antennas. (This is sometimes called the “pizza box rule”–the antenna is protected if it’s smaller than 1 meter diameter.) Without this state law and the FCC rules, towns and counties could and would prohibit antennas or fine residents and broadband companies for installing small broadband and TV antennas on the grounds that the antennas are an unpermitted accessory structure or zoning violation.

The FCC’s new 2021 rules are broader and protect certain types of outdoor 5G and WiFi antennas that serve multiple households. The Arizona law doesn’t extend to these “one-to-many” antennas but its protections supplement those FCC rules and clearer than FCC rules, which can directly regulate antennas but not town and city officials. Between the FCC rules and the Arizona law, Arizona households and renters have new, substantial freedom to install 5G and other wireless antennas on their rooftops, balconies, and yard poles. In rural areas especially this will help get infrastructure and small broadband antennas installed quickly on private property.

Too often, policy debates by state lawmakers and agencies are dominated by incremental reforms of longstanding issues and established industries. Very few states plant the seeds–via policy and law–for promotion of new industries. Passenger drones, smart corridors, autonomous vehicles, and drone delivery are maturing as technologies. Preparing for those industries signals to companies and their investors that innovation, legal clarity, and investment is a priority for the state. Hopefully other states will take Arizona’s lead and look to encouraging the industries and services of the future.

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Some data on wireless networks and cancer rates

by on November 6, 2018 · 0 comments

By Brent Skorup and Trace Mitchell

An important benefit of 5G cellular technology is more bandwidth and more reliable wireless services. This means carriers can offer more niche services, like smart glasses for the blind and remote assistance for autonomous vehicles. A Vox article last week explored an issue familiar to technology experts: will millions of new 5G transmitters and devices increase cancer risk? It’s an important question but, in short, we’re not losing sleep over it.

5G differs from previous generations of cellular technology in that “densification” is important–putting smaller transmitters throughout neighborhoods. This densification process means that cities must regularly approve operators’ plans to upgrade infrastructure and install devices on public rights-of-way. However, some homeowners and activists are resisting 5G deployment because they fear more transmitters will lead to more radiation and cancer. (Under federal law, the FCC has safety requirements for emitters like cell towers and 5G. Therefore, state and local regulators are not allowed to make permitting decisions based on what they or their constituents believe are the effects of wireless emissions.)

We aren’t public health experts; however, we are technology researchers and decided to explore the telecom data to see if there is a relationship. If radio transmissions increase cancer, we should expect to see a correlation between the number of cellular transmitters and cancer rates. Presumably there is a cumulative effect: the more cellular radiation people are exposed to, the higher the cancer rates.

From what we can tell, there is no link between cellular systems and cancer. Despite a huge increase in the number of transmitters in the US since 2000, the nervous system cancer rate hasn’t budged. In the US the number of wireless transmitters have increased massively–300%–in 15 years. (This is on the conservative side–there are tens of millions of WiFi devices that are also transmitting but are not counted here.) Continue reading →

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Don’t game EPA regulations to help DSRC car technology

by on November 1, 2018 · 0 comments

By Brent Skorup and Michael Kotrous

In 1999, the FCC completed one of its last spectrum “beauty contests.” A sizable segment of spectrum was set aside for free for the US Department of Transportation (DOT) and DOT-selected device companies to develop DSRC, a communications standard for wireless automotive communications, like vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I). The government’s grand plans for DSRC never materialized and in the intervening 20 years, new tech—like lidar, radar, and cellular systems—advanced and now does most of what regulators planned for DSRC.

Too often, however, government technology plans linger, kept alive by interest groups that rely on the new regulatory privilege, even when the market moves on. At the eleventh hour of the Obama administration, NHTSA proposed mandating DSRC devices in all new vehicles, an unprecedented move that Brent and other free-market groups opposed in public interest comment filings. As Brent wrote last year,

In the fast-moving connected car marketplace, there is no reason to force products with reliability problems [like DSRC] on consumers. Any government-designed technology that is “so good it must be mandated” warrants extreme skepticism….

Further,

Rather than compel automakers to add costly DSRC systems to cars, NHTSA should consider a certification or emblem system for vehicle-to-vehicle safety technologies, similar to its five-star crash safety ratings. Light-touch regulatory treatment would empower consumer choice and allow time for connected car innovations to develop.

Fortunately, the Trump administration put the brakes on the mandate, which would have added cost and complexity to cars for uncertain and unlikely benefits.

However, some regulators and companies are trying to revive the DSRC device industry while NHTSA’s proposed DSRC mandate is on life support. Marc Scribner at CEI uncovered a sneaky attempt to create DSRC technology sales via an EPA proceeding. The stalking horse DSRC boosters have chosen is the Corporate Average Fuel Economy (CAFE) regulations—specifically the EPA’s off-cycle program. EPA and NHTSA jointly manage these regulations. That program rewards manufacturers who adopt new technologies that reduce a vehicle’s emissions in ways not captured by conventional measures like highway fuel economy.

Under the proposed rules, auto makers that install V2V or V2I capabilities can receive credit for having reduced emissions. The EPA proposal doesn’t say “DSRC” but it singles out only one technology standard that would be favored in this scheme: a standard underlying DSRC. 

This proposal comes as a bit of surprise for those who have followed auto technology; we’re aware of no studies showing DSRC improves emissions. (DSRC’s primary use-case today is collision warnings to the driver.) But the EPA proposes a helpful end-around that problem: simply waiving the requirement that manufacturers provide data showing a reduction in harmful emissions. Instead of requiring emissions data, the EPA proposes a much lower bar, that auto makers show that these devices merely “have some connection to overall environmental benefits.” Unless the agency applies credits in a tech-neutral way and requires more rigor in the final rules, which is highly unlikely, this looks like a backdoor subsidy to DSRC via gaming of emission reduction regulations.

Hopefully EPA regulators will discover the ruse and drop the proposal. It was a pleasant surprise last week when a DOT spokesman committed that the agency favored a tech-neutral approach for this “talking car” band. But after 20 years, this 75 MHz of spectrum gifted to DSRC device makers should be repurposed by the FCC for flexible-use. Fortunately, the FCC has started thinking about alternative uses for the DSRC spectrum. In 2015 Commissioners O’Rielly and Rosenworcel said the agency should consider flexible-use alternatives to this DSRC-only band.

The FCC would be wise to follow through and push even farther. Until the gifted spectrum that powers DSRC is reallocated to flexible use, interest groups will continue to pull any regulatory lever it has to subsidize or mandate adoption of talking-car technology. If DSRC is the best V2V technology available, device makers should win market share by convincing auto companies, not by convincing regulators.

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The FCC can increase 5G deployment by empowering homeowners

by on July 26, 2018 · 0 comments

The move to small cells and fixed wireless broadband means states, cities, and the FCC are changing their regulatory approaches. For decades, wireless providers have competed primarily on coverage, which meant building large cell towers all over the country, each one serving hundreds of people. That’s changing. As Commissioner Carr noted,

5G networks will look very different from today’s 4G deployments. 5G will involve the addition of hundreds of thousands of new, small-scale facilities with antennas no larger than a small backpack.

Currently, wireless companies don’t have many good options when it comes to placing these lower-power, higher-bandwidth “small cells.” They typically install small cells and 5G transmitters on public rights-of-way and on utility poles, but there may not be room on poles and attachment fees might be high. 

One thing the FCC might consider to stimulate 5G and small cell investment is to dust off its 20 year-old over-the-air-reception-device (OTARD) rules. These little-known rules protect homeowners and renters from unwarranted regulation of TV and broadband antennas placed on their property. If liberalized, the OTARD rules would open up tens of millions of other potential small cell sites–on rooftops, on balconies, and in open fields and backyards around the country. 

Background

In the early 1990s, cities and homeowner associations would sometimes prohibit, charge for, or regulate satellite dishes that homeowners or renters installed on their rooftops or balconies. Lawmakers saw a problem and wanted to jumpstart competition in television (cities had authorized cable TV monopolies for decades and cable had over 95% of the pay-TV market).

In the 1996 Telecom Act, then, Congress instructed the FCC to increase TV competition by regulating the regulators. Congress said that state, local, and HOA restrictions cannot impose restrictions that

impair a viewer’s ability to receive video programming services through devices designed for over-the-air reception of television broadcast signals, multichannel multipoint distribution service [MMDS], or direct broadcast satellite services.

With these congressional instructions, the FCC created its OTARD rules, informally known as the “pizza box rule.” Briefly stated, if your TV antenna, satellite TV receiver, or “fixed wireless” antenna is smaller than a large pizza (1 meter diameter–no cell towers in front yards), you are free to install the necessary equipment on property you control, like a yard or balcony. (There are some exceptions for safety issues and historical buildings.) The 1996 law expressly protects MMDS (now called “broadband radio service”), which includes spectrum in the 2.1 GHz, 2.5 GHz, 2.6 GHz, 28 GHz, 29 GHz, and 31 GHz bands. The Clinton FCC expanded the rules to protect, broadly, any antennas that “receive or transmit fixed wireless signals.” You can even install a mast with an antenna that extends up to 12 feet above your roofline. 

OTARD reform

The rules protect fixed wireless antennas and could see new life in the 5G world. Carriers are building small cells and fixed wireless primarily to provide faster broadband and “mobile TV” services. Millions of Americans now view their cable and Netflix content on mobile devices and carriers are starting to test mobile-focused pay-TV services. AT&T has Watch TV, T-Mobile is expected to deploy a mobile TV service soon because of its Layer3 acquisition, and reporting suggests that Verizon is approaching YouTube TV and Apple to supply TV for its 5G service. 

The FCC’s current interpretation of its OTARD rules doesn’t help 5G and small cell deployment all that much, even though the antennas are small and they transmit TV services. The actual rules don’t say this but the FCC’s interpretation is that their OTARD protections don’t protect antenna “hubs” (one-to-many transmitters like small cells). The FCC liberalized this interpretation in its Massport proceeding and allowed hub one-to-many transmitters [Correction, via Connor at the FCC: the FCC liberalized to say that one-to-many transmitters are permitted, not hub antennas.] but did not extend this interpretation for homeowners’ antennas. In short, under the current interpretation, cities and HOAs can regulate, charge for, and prohibit the installation of 5G and small cells on private property.

The FCC should consider expanding its rules to protect the installation of (low power) 5G and small cell hubs on private property. This would directly improve, per the statute, “viewers’ ability to receive video programming services” via wireless. It would have the ancillary effect of improving other wireless services. The prospect of installing small cells on private property, even temporarily, should temper the fees carriers are charged to use the public rights-of-way and poles.

In rural areas, the FCC might also consider modifying the rules to allow masts that extend beyond 12 feet above the roofline. Transmitters even a few feet taller would improve wireless backhaul and coverage to nearby homes, thus increasing rural broadband deployment and IP-based television services.

Wireless trends

OTARD reform is especially timely today because the Wheeler and Pai FCCs have freed up several bands of spectrum and fixed wireless is surging. Fixed wireless and mesh network providers using CBRS and other spectrum bands could benefit from more installation sites, particularly in rural areas. C Spire, for instance, is creating “hub homes” for fixed wireless, and Starry and Rise Broadband are expanding their service areas. CableLabs is working on upgrading cable networks for mobile and 5G backhaul and cable operators might benefit from OTARD reform and more outside infrastructure.

Modifying the OTARD rules might be controversial but modification directly gives consumers and homeowners more control over improving broadband service in their neighborhood, just as the rules improved TV competition in the past. Courts are pretty deferential when agencies change an interpretation of an existing rule. Further, as the agency said years ago:

The Federal Communications Commission has consistently maintained that it has the ultimate responsibility to determine whether the public interest would be served by construction of any specific antenna tower.

The future of wireless services is densification–putting fiber and small cells all over downtowns and neighborhoods in order to increase broadband capacity for cutting-edge services, like smart glasses for the blind and remote-controlled passenger cars. The OTARD rules and the FCC’s authority over wireless antennas provides another tool to improve wireless coverage and TV services.

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Some thoughts on the T-Mobile-Sprint merger

by on April 30, 2018 · 3 comments

Mobile broadband is a tough business in the US. There are four national carriers–Verizon, AT&T, T-Mobile, and Sprint–but since about 2011, mergers have been contemplated (and attempted, but blocked). Recently, the competition has gotten fiercer. The higher data buckets and unlimited data plans have been great for consumers.

The FCC’s latest mobile competition report, citing UBS data, says that industry ARPU (basically, monthly revenue per subscriber), which had been pretty stable since 1998, declined significantly from 2013 to 2016 from about $46 to about $36. These revenue pressures seemed to fall hardest on Sprint, who in February, issued $1.5 billion of “junk bonds” to help fund its network investments. Analysts pointed out in 2016 that “Sprint has not reported full-year net profits since 2006.” Further, mobile TV watching is becoming a bigger business. AT&T and Verizon both plan to offer a TV bundle to their wireless customers this year, and T-Mobile’s purchase of Layer3 indicates an interest in offering a mobile TV service.

It’s these trends that probably pushed T-Mobile and Sprint to announce yesterday their intention to merge. All eyes will be on the DOJ and the FCC as their competition divisions consider whether to approve the merger.

The Core Arguments

Merger opponents’ primary argument is what’s been raised several times since the 2011 AT&T-T-Mobile aborted merger: this “4 to 3” merger significantly raises the prospect of “tacit collusion.” After the merger, the story goes, the 3 remaining mobile carriers won’t work as hard to lower prices or improve services. While outright collusion on prices is illegal, they have a point that tacit collusion is more difficult for regulators to prove, to prevent, and to prosecute.

The counterargument, that T-Mobile and Sprint are already making, is that “mobile” is not a distinct market anymore–technologies and services are converging. Therefore, tacit collusion won’t be feasible because mobile broadband is increasingly competing with landline broadband providers (like Comcast and Charter), and possibly even media companies (like Netflix and Disney). Further, they claim, T-Mobile and Sprint going it alone will each struggle to deploy a capex-intensive 5G network that can compete with AT&T, Verizon, Comcast-NBCU, and the rest, but the merged company will be a formidable competitor in TV and in consumer and enterprise broadband.

Competitive Review

Any prediction about whether the deal will be approved or denied is premature. This is a horizontal merger in a highly-visible industry and it will receive an intense antitrust review. (Rachel Barkow and Peter Huber have an informative 2001 law journal article about telecom mergers at the DOJ and FCC.) The DOJ and FCC will seek years of emails and financial records from Sprint and T-Mobile executives and attempt to ascertain the “real” motivation for the merger and its likely consumer effects.

T-Mobile and Sprint will likely lean on evidence that consumers view (or soon will view) mobile broadband and TV as a substitute for landline broadband and TV. Much like phone and TV went from “local markets with one or two competitors” years ago to a “national market with several competitors,” their story seems to be, broadband is following a similar trajectory and viewing this as a 4 to 3 merger misreads industry trends.

There’s preliminary evidence that mobile broadband will put competitive pressure on conventional, landline broadband. Census surveys indicate that in 2013, 10% of Internet-using households were mobile Internet only (no landline Internet). By 2015, about 20% of households were mobile-only, and the proportion of Internet users who had landline broadband actually fell from 82% to 75%. But this is still preliminary and I haven’t seen economic evidence yet that mobile is putting pricing pressure on landline TV and broadband.

FCC Review

Antitrust review is only one step, however. The FCC transaction review process is typically longer and harder to predict. The FCC has concurrent authority with the DOJ under the Clayton Act to review telecommunications mergers under Sections 7 and 11 of the Clayton Act but it has never used that authority. Instead, the FCC uses its spectrum transfer review authority as a hook to evaluate mergers using the Communication Act’s (vague) “public interest standard.” Unlike antitrust standards, which generally put the burden on regulators to show consumer and competitive harm, the public interest standard as currently interpreted puts the burden on merging companies to show social and competitive benefits.

Hopefully the FCC will hew to a more rigorous antitrust inquiry and reform the open-ended public interest inquiry. As Chris Koopman and I wrote for the law journal a few years ago, these FCC  “public interest” reviews are sometimes excessively long and advocates use the vague standards to force the FCC into ancillary concerns, like TV programming decisions and “net neutrality” compliance.

Part of the public interest inquiry is a complex “spectrum screen” analysis. Basically, transacting companies can’t have too much “good” spectrum in a single regional market. I doubt the spectrum screen analysis would be dispositive (much of the analysis in the past seemed pretty ad hoc), but I do wonder if it will be an issue since this was a major issue raised in the AT&T-T-Mobile attempted merger.

In any case, that’s where I see the core issues, though we’ll learn much more as the merger reviews commence.

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Some thoughts on how to fix rural broadband programs

by on April 13, 2018 · 0 comments

Expanding rural broadband has generated significant interest in recent years. However, the current subsidy programs are often mismanaged and impose little accountability. It’s not clear what effect rural broadband subsidies have had, despite the amount of money spent on it. As economist Scott Wallsten has pointed out, the US government has spent around $100 billion on rural telecommunications and broadband since 1995 “without evidence that it has improved adoption.”

So I was pleased to hear a few months ago that the Montana Public Service Commission was making an inquiry into how to improve rural broadband subsidy programs. Montana looms large in rural broadband discussions because Montana telecommunications providers face some of the most challenging terrain the US–mountainous, vast, and lightly-populated. (In fact, “no bars on your phone” in rural Montana is a major plot element in the popular videogame Far Cry 5. HT Rob Jackson.)

I submitted comments in the Montana PSC proceeding and received an invitation to testify at a hearing on the subject. So last week I flew to Helena to discuss rural broadband programs with the PSC and panelists. I emphasized three points.

  • Federal broadband subsidy programs are facing higher costs and fewer beneficiaries.

Using FCC data, I calculated that since 1998, USF high-cost subsidies to Montana telecom companies have risen by about 40% while the number of rural customers served by those companies have decreased by over 50%. I suspect these trends are common nationally, and that USF subsidies are increasing while fewer people are benefiting.

  • Wireless broadband is the future, especially in rural areas.

“Fiber everywhere” is not a wise use of taxpayer funds and exurban and rural households are increasingly relying on wireless–from satellite, WISPs, and mobile. In 2016, the CDC reported that more households had wireless phone than landline phone service. You’re starting to see “cord cutting” pick up for broadband as well. Census surveys indicate that in 2013, 10% of Internet-using households were mobile Internet only (no landline Internet). By 2015, that percentage had doubled, and about 20% of households were mobile-only. The percentage is likely even higher today now that unlimited data plans are common. Someday soon the FCC will have to conclude that mobile broadband is a substitute for fixed broadband, and subsidy programs should reflect that.

  • Consumer-focused “tech vouchers” would be a huge improvement over current broadband programs.

Current programs subsidize the construction of networks even where there’s no demand. The main reason the vast majority of non-Internet users don’t subscribe to broadband is that they are uninterested in subscribing, according to surveys from the NTIA (55% are uninterested), Pew (70% are uninterested), and FCC and Connected Nation experts (63% are uninterested). With rising costs and diminishing returns to rural fiber construction, the FCC needs to reevaluate USF and make subsidies more consumer-focused. The UK for a couple years has pursued another model for rural broadband: consumer broadband vouchers. Since most people who don’t subscribe to broadband don’t want it, vouchers protect taxpayers from unnecessary expense and paying for gold-plated services.

For years, economists and the GAO have criticized the structure, complexity, and inefficiency of the USF programs, and particularly the rural program. The FCC is constantly changing the programs because of real and perceived deficiencies, but this has made the USF unwieldy. Montana providers participate in at least seven different rural USF programs alone (that doesn’t include the other USF programs and subprograms or other federal help, like RUS grants).

Unfortunately, most analysis and reporting on US broadband programs can be summed up as “don’t touch the existing programs–just send more money.” (There are some exceptions and scrutiny of the programs, like Tony Romm’s 2015 Politico investigation into the mismanagement of stimulus-funded Ag Department broadband projects.)

“Journalism as advocacy” is unfortunately the norm when it comes to broadband policy. Take, for instance, this article about the digital divide that omits mention of the $100 billion spent in rural areas alone, only to conclude that “small [broadband] companies and cooperatives are going it more or less alone, without much help yet from the federal government.”

(That story and another digital divide story had other problems, namely, a reliance on an academic study using faulty data purchased from a partisan campaign firm. FiveThirtyEight deserves credit for acknowledging the data’s flaws but that should have alerted the editors on the need for still more fact-checking.) 

States can’t rewrite federal statutes and regulations but it’s to the Montana PSC’s great credit that they sensed that all is not well. Current trends will only put more stress on the programs. Hopefully other state PUCs will see that the current programs do a disservice for universal service objectives and consumers.

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Thoughts on the FCC’s recent wireless deployment efforts

by on March 20, 2018 · 0 comments

Years ago it looked like the Obama FCC would make broadband deployment, especially wireless service and spectrum reform, a top priority. They accomplished plenty–including two of the largest spectrum auctions to date–but, under tremendous political and special interest pressure, FCC leadership diverted significant agency resources into regulatory battles that had very little upside, like regulating TV apps and unprecedented regulation of Internet services.

Fortunately, the Trump FCC so far has made broadband deployment the agency’s top priority, which Chairman Pai signaled last year with the creation of the Broadband Deployment Advisory Committee. As part of those deployment efforts, Commissioner Carr has led an effort to streamline some legacy regulatory obstacles, like historic preservation and environmental reviews and the FCC will vote this week on an order to expedite wireless infrastructure construction.

According to the FCC, somewhere around 96% of the US population has LTE coverage from three or more wireless operators, like Verizon, AT&T, T-Mobile, and Sprint. The operators’ job isn’t done in rural areas, but much of the future investment into broadband networks will be to “densify” their existing coverage maps with “small cells” in order to provide wireless customers more bandwidth.

Since telecom companies build infrastructure, many current projects require review under the federal National Historic Preservation Act and the National Environmental Policy Act. However, unlike for the 100-foot cellphone towers in the past, the environmental checklists currently required for small cells are largely perfunctory since small cells typically use existing infrastructure, like utility poles. For Sprint’s tens of thousands of small cell site applications, for instance, the proposed order says “every single review resulted in a finding of no significant impact.”

The order under consideration will bring some structure to regulatory timelines and procedures. This should save carriers on unnecessary regulatory overhead and, more importantly, save time.

The order comes at a crucial time, which is why the prior FCC’s net neutrality distractions are so regrettable. Mobile broadband has huge demands and inadequate infrastructure and spectrum. According to studies, millions of Americans are going “mobile only,” and bypassing landline Internet service. Census Bureau surveys estimated that in 2015, about 20% of Internet-using households were mobile-only. (HT to Michael Horney.) That number is likely even higher today.

The construction of higher-capacity and 5G wireless, combined with repeal of the 2015 Internet regulations, will give consumers more options and better prices for Internet services, and will support new mobile applications like remote-control of driverless cars and AR “smart glasses” for blind people. Hopefully, after this order, the agency will continue with spectrum liberalization and other reforms that will expedite broadband projects.

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The government’s “talking cars” plans failed. What’s next for the spectrum?

by on March 15, 2018 · 0 comments

In the waning days of the Obama administration, the US Department of Transportation (USDOT) proposed to mandate a government-designed “talking cars” technology–so-called DSRC devices–on all new cars. Fortunately, in part because of opposition from free-market advocates, the Trump administration paused the proposed mandate. The FCC had set aside spectrum in the 5.9 GHz band for DSRC technologies in 1999 but it’s been largely unused since then and these new developments raise the question: What to do with that 75 MHz of fairly “clean” spectrum? Hopefully the FCC will take the opportunity to liberalize the use of the DSRC band so it can be put to better uses.

Background

Since the mid-1990s, the USDOT and auto device suppliers have needed the FCC’s assistance–via free spectrum–to jumpstart the USDOT’s vehicle-to-vehicle technology plans. The DSRC disappointment provides an illustration of what the FCC (and other agencies) should not do. DSRC was one of the FCC’s last major “beauty contests,” which is where the agency dispenses valuable spectrum for free on the condition it be used for certain, narrow uses–in this case, only USDOT-approved wireless systems for transportation. The grand plans for DSRC haven’t lived up to its expectations (USDOT officials in 2004 were predicting commercialization as early as 2005) and the device mandate in 2016–now paused–was a Hail Mary attempt to compel widespread adoption of the technology.

Last year, I submitted public interest comments to the USDOT opposing the proposed DSRC mandate as premature, anticompetitive, and unsafe (researchers found, for instance, that “the system will be able to reliably predict collisions only about 35% of the time”). I noted that, after nearly 20 years of work on DSRC, the USDOT and their hand-selected vendors had made little progress and were being leapfrogged by competing systems, like automatic emergency brakes, to say nothing of self-driving cars. The FCC has noticed the fallow DSRC spectrum and Commissioners O’Rielly and Rosenworcel proposed in 2015 to allow other, non-DSRC wireless technologies, like WiFi, into the band.

The FCC’s Role

These DSRC devices use spectrum in the 5.9 GHz band. The FCC set aside radio spectrum in the band for DSRC applications in 1999 based on a scant 19 comments and reply comments from outside parties. 

Despite the typical flowery language in the 1999 Order, FCC commissioners and Wireless Bureau staff must have had an inkling this was not a good idea. After decades of beauty contests, it was clear the spectrum set-asides were inefficient and anticonsumer, and in 1993 Congress gave the FCC authority to auction spectrum to the highest bidder. The FCC also moved towards “flexible-use” licenses in the 1990s, thus replacing top-down technology choices with market-driven ones. The DSRC set-aside broke from those practices, likely because DSRC in 1999 had powerful backers that the FCC simply couldn’t ignore: the USDOT, device vendors, automakers, and some members of Congress.

The FCC then codified the first DSRC standards in 2003. However, innovation at the speed of government, it turns out, isn’t very speedy at all. The fast-moving connected car industry simply moved ahead without waiting for DSRC technology to catch up. (Government-selected vendors making devices according to 15-year old government-prescribed technical standards on spectrum allocated by the government in 1999 in a fast-moving technology sector. What could go wrong?)

A Second Chance

So if the DSRC plans didn’t pan out, what should be done with that spectrum? Hopefully the FCC will liberalize the band and, possibly, combine it with the adjacent bands.

The gold standard for maximizing the use of spectrum is flexible-use, licensed spectrum, so the best option is probably liberalizing the DSRC spectrum, combining it with the adjacent higher band (5.925 GHz to 6.425 GHz) and auctioning it. In November 2017, the FCC asked about freeing this latter band for flexible, licensed use.  

The other (probably more popular) option is liberalizing the DSRC band and making it available for free, that is, unlicensed use. Giving away spectrum for free often leads to misallocation but this option is better than keeping it dedicated for DSRC technology. Unlicensed is for flexible uses and allows for many consumer technologies like WiFi, Bluetooth, and unlicensed LTE devices.

Further, because of global technical standards, unlicensed devices in the DSRC band make far more sense, it seems to me, in 5.9 GHz than in the CBRS band* (3.6 GHz), which many countries are using for licensed services like LTE. The FCC is currently trying to simplify the rules in the CBRS band to encourage investment in licensed services, and perhaps that’s a compromise the FCC will reach with those who want more unlicensed spectrum: make 3.6 GHz more accommodating for licensed, flexible uses but in return open the DSRC band to unlicensed devices.

Either way, the FCC has an opportunity to liberalize the use of the DSRC band. Grand plans for DSRC didn’t work out and hopefully the FCC can repurpose that spectrum for flexible uses, either licensed or unlicensed.

 

 

*Technically, the GAA devices in the CBRS band are non-exclusive licenses, but the rules intentionally resemble an unlicensed framework.

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Nationalizing 5G networks? Why that’s a bad idea.

by on January 29, 2018 · 0 comments

There was a bold, bizarre proposal published by Axios yesterday that includes leaked documents by a “senior National Security Council official” for accelerating 5G deployment in the US. “5G” refers to the latest generation of wireless technologies, whose evolving specifications are being standardized by global telecommunications companies as we speak. The proposal highlights some reasonable concerns–the need for secure networks, the deleterious slowness in getting wireless infrastructure permits from thousands of municipalities and counties–but recommends an unreasonable solution–a government-operated, nationwide wireless network.

The proposal to nationalize some 5G equipment and network components needs to be nipped in the bud. It relies on the dated notion that centralized government management outperforms “wasteful competition.” It’s infeasible and would severely damage the US telecom and Internet sector, one of the brightest spots in the US economy. The plan will likely go nowhere but the fact it’s being circulated by administration officials is alarming.

First, a little context. In 1927, the US nationalized all radiofrequency spectrum, and for decades the government rations out dribbles of spectrum for commercial use (though much has improved since liberalization in the 1990s). To this day all spectrum is nationalized and wireless companies operate at sufferance. What this new document proposes is to make a poor situation worse.

In particular, the presentation proposes to re-nationalize 500 MHz of spectrum (the 3.7 GHz to 4.2 GHz band, which contains mostly satellite and government incumbents) and build wireless equipment and infrastructure across the country to transmit on this band. The federal government would act as a wholesaler to the commercial networks (AT&T, Verizon, T-Mobile, Sprint, etc.), who would sell retail wireless plans to consumers and businesses.

The justification for nationalizing a portion of 5G networks has a national security component and an economic component: prevent Chinese spying and beat China in the “5G race.”

The announced goals are simultaneously broad and narrow, and at severe tension.

The plan is broad in that it contemplates nationalizing part of the 5G equipment and network. However, it’s narrow in that it would nationalize only a portion of the 5G network (3.7 GHz to 4.2 GHz) and not other portions (like 600 MHz and 28 GHz). This undermines the national security purpose (assuming it’s even feasible to protect the nationalized portion) since 5G networks interconnect. It’d be like having government checkpoints on Interstate 95 but leaving all other interstates checkpoint-free.

Further, the document author misunderstands the evolutionary nature of 5G networks. 5G for awhile will be an overlay on the existing 4G LTE network, not a brand-new parallel network, as the NSC document assumes. 5G equipment will be installed on 4G LTE infrastructure in neighborhoods where capacity is strained. As Sherif Hanna, director of the 5G team at Qualcomm, noted on Twitter, in fact, “the first version of the 5G [standard]…by definition requires an existing 4G radio and core network.”

https://twitter.com/sherifhanna/status/957891843533946880

The most implausible idea in the document is a nationwide 5G network could be deployed in the next few years. Environmental and historic preservation review in a single city can take longer than that. (AT&T has battled NIMBYs and local government in San Francisco for a decade, for instance, to install a few hundred utility boxes on the public right-of-way.) The federal government deploying and maintaining hundreds of thousands 5G installations in two years from scratch is a pipe dream. And how to pay for it? The “Financing” section in the document says nothing about how the federal government will find tens of billions of dollars for nationwide deployment of a government 5G network.

The plan to nationalize a portion of 5G wireless networks and deploy nationwide is unwise and unrealistic. It would permanently damage the US broadband industry, it would antagonize city and state officials, it would raise serious privacy and First Amendment concerns, and it would require billions of new tax dollars to deploy. The released plan would also fail to ensure the network security it purports to protect. US telecom companies are lining up to pay the government for spectrum and to invest private dollars to build world-class 5G networks. If the federal government wants to accelerate 5G deployment, it should sell more spectrum and redirect existing government funding towards roadside infrastructure. Network security is a difficult problem but nationalizing networks is overkill.

Already, four out of five [update: all five] FCC commissioners have come out strongly against this plan. Someone reading the NSC proposal would get the impression that the US is sitting still while China is racing ahead on 5G. The US has unique challenges but wireless broadband deployment is probably the FCC’s highest priority. The Commission is aware of the permitting problems and formed the Broadband Deployment Advisory Committee in part for that very purpose (I’m a member). The agency, in cooperation with the Department of Commerce, is also busy looking for more spectrum to release for 5G.

Recode is reporting that White House officials are already distancing the White House from the proposal. Hopefully they will publicly reject the plan soon.

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What is “broadband” speed and why does it matter?

by on September 20, 2017 · 0 comments

Internet regulation advocates are trying to turn a recent FCC Notice of Inquiry about the state of US telecommunications services into a controversy. Twelve US Senators have accused the FCC of wanting to “redefin[e] broadband” in order to “abandon further efforts to connect Americans.”

Considering Chairman Pai and the Commission are already considering actions to accelerate the deployment of broadband, with new proceedings and the formation of the Broadband Deployment Advisory Committee, the allegation that the current NOI is an excuse for inaction is perplexing.

The true “controversy” is much more mundane–reasonable people disagree about what congressional neologisms like “advanced telecommunications capability” mean. The FCC must interpret and apply the indeterminate language of Section 706 of the Telecommunications Act, which requires the FCC about whether to determine “whether advanced telecommunications capability is being deployed in a reasonable and timely fashion.” If the answer is negative, the agency must “take immediate action to accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition in the telecommunications market.” The inquiry is reported in an annual “Broadband Progress Report.” Much of the “scandal” of this proceeding is confusion about what “broadband” means.

What is broadband?

First: what qualifies as “broadband” download speed? It depends.

The OECD says anything above 256 kbps.

ITU standards set it at above 1.5 Mbps (or is 2.0 Mbps?).

In the US, broadband is generally defined as a higher speed. The USDA’s Rural Utilities Service defines it as 4.0 Mbps.

The FCC’s 2015 Broadband Progress Report found, as Obama FCC officials put it, that “the FCC’s definition of broadband” is now 25 Mbps. This is why advocates insist “broadband access” includes only wireline services above 25 Mbps.

But in the same month, the Obama FCC determined in the Open Internet Order that anything above dialup speed–56 kbps–is “broadband Internet access service.”

So, according to regulation advocates, 1.5 Mbps DSL service isn’t “broadband access” service but it is “broadband Internet access service.” Likewise a 30 Mbps 4G LTE connection isn’t a “broadband access” service but it is “broadband Internet access service.”

In other words, the word games about “broadband” are not coming from the Trump FCC. There is no consistency for what “broadband” means because prior FCCs kept changing the definition, and even use the term differently in different proceedings. As the Obama FCC said in 2009, “In previous reports to Congress, the Commission used the terms ‘broadband,’ ‘advanced telecommunications capability,’ and ‘advanced services’ interchangeably.”

Instead, what is going on is that the Trump FCC is trying to apply Section 706 to the current broadband market. The main questions are, what is advanced telecommunications capability, and is it “being deployed in a reasonable and timely fashion”?

Is mobile broadband an “advanced telecommunications capability”?

Previous FCCs declined to adopt a speed benchmark for when wireless service satisfies the “advanced telecommunications capability” definition. The so-called controversy is because the latest NOI revisits this omission in light of consumer trends. The NOI straightforwardly asks whether mobile broadband above 10 Mbps satisfies the statutory definition of “advanced telecommunications capability.”

For that, the FCC must consult the statute. Such a capability, the statute says, is technology-neutral (i.e. includes wireless and “fixed” connections) and “enables users to originate and receive high-quality voice, data, graphics, and video telecommunications.”

Historically, since the statute doesn’t provide much precision, the FCC has examined subscription rates of various broadband speeds and services. From 2010 to 2015, the Obama FCCs defined advanced telecommunications capability as a fixed connection of 4 Mbps. In 2015, as mentioned, that benchmark was raised 25 Mbps.

Regulation advocates fear that if the FCC looks at subscription rates, the agency might find that mobile broadband above 10 Mbps is an advanced telecommunications capability. This finding, they feel, would undermine the argument that the US broadband market needs intense regulation. According to recent Pew surveys, 12% of adults–about 28 million people–are “wireless only” and don’t have a wireline subscription. Those numbers certainly raise the possibility that mobile broadband is an advanced telecommunications capability.

Let’s look at the three fixed broadband technologies that “pass” the vast majority of households–cable modem, DSL, and satellite–and narrow the data to connections 10 Mbps or above.*

Home broadband connections (10 Mbps+)
Cable modem – 54.4 million
DSL – 11.8 million
Satellite – 1.4 million

It’s hard to know for sure since Pew measures adult individuals and the FCC measures households, but it’s possible more people have 4G LTE as home broadband (about 28 million adults and their families) than have 10 Mbps+ DSL as home broadband (11.8 million households).

Subscription rates aren’t the end of the inquiry, but the fact that millions of households are going mobile-only rather than DSL or cable modem is suggestive evidence that mobile broadband offers an advanced telecommunications capability. (Considering T-Mobile is now providing 50 GB of data per line per month, mobile-only household growth will likely accelerate.)

Are high-speed services “being deployed in a reasonable and timely fashion”?

The second inquiry is whether these advanced telecommunications capabilities “are being deployed in a reasonable and timely fashion.” Again, the statute doesn’t give much guidance but consumer adoption of high-speed wireline and wireless broadband has been impressive.

So few people had 25 Mbps for so long that the FCC didn’t record it in its Internet Access Services reports until 2011. At the end of 2011, 6.3 million households subscribed to 25 Mbps. Less than five years later, in June 2016, over 56 million households subscribed. In the last year alone, fixed providers extended 25 Mbps or greater speeds to 21 million households.

The FCC is not completely without guidance on this question. As part of the 2008 Broadband Data Services Improvement Act, Congress instructed the FCC to use international comparisons in its Section 706 Report. International comparisons also suggest that the US is deploying advanced telecommunications capability in a timely manner. For instance, according to the OECD the US has 23.4 fiber and cable modem connections per 100 inhabitants, which far exceeds the OECD average, 16.2 per 100 inhabitants.**

Anyways, the sky is not falling because the FCC is asking about mobile broadband subscription rates. More can be done to accelerate broadband–particularly if the government frees up more spectrum and local governments improve their permitting processes–but the Section 706 inquiry offers little that is controversial or new.

 

*Fiber and fixed wireless connections, 9.6 million and 0.3 million subscribers, respectively, are also noteworthy but these 10 Mbps+ technologies only cover certain areas of the country.

**America’s high rank in the OECD is similar if DSL is included, but the quality of DSL varies widely and often doesn’t provide 10 Mbps or 25 Mbps speeds.

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