PSC Tells FCC Low Broadband Speeds Are OK for New York’s Unserved and Underserved Areas

As a follow-up to its comments recently filed at the FCC regarding the federal rural broadband strategy, see PSC Files Comments with FCC on Federal Rural Broadband Strategy, Forgets Affordability Issue for Low-Income Households, the New York State Public Service Commission (“PSC”), along with the state’s Office for Technology (“OT”), submitted a second set of comments focused on definitions used in the granting process for broadband projects under the American Recovery and Reinvestment Act (“ARRA”) .

The PSC and OT emphasized the need for flexibility in order to “allow for providing and enhancing connectivity to the broadest spectrum of users based on their service needs.” While PULP generally supports flexible application of requirements to ensure, for example, that small customers are not unduly burdened by rules placed on larger customers, the PSC and OT missed the point in this regard. The comments looked at several of ARRA’s broadband definitions, including “unserved” areas and “underserved” areas.

Currently, an unserved area is defined as an area which either has no Internet access or service below 768 kilobits per second (“kbps”). By today's standards, this is a laughably slow speed, and only a fraction of what is considered to be “broadband” in other parts of the world.

According to a 2007 report of the Information Technology and Innovation Foundation, in Japan, for example, over 75 percent of NTT East’s customers receive speeds of 100 megabits per second (“mbps”) (at about $27 per month, compared to about $30 per month for 1.5 mbps in the United States), which is more than 100 times faster than what passes for broadband in the United States under this outdated definition and at a fraction of the price.

The PSC and OT argued that if there are no other providers offering Internet service in a particular area, then applicants for ARRA funding should be able to receive a grant for speeds below 768 kbps. Basic digital subscriber line (“DSL”) service over existing copper loops offered by every local exchange carrier in many but not all areas of the country generally offers speeds in excess of 1.5 mbps – twice the PSC's proposed definition of broadband for unserved and underserved areas.

There is no reason to look backwards and deprive people in primarily rural areas an opportunity to receive true broadband, even if this “true broadband” does pale in comparison to speeds offered in other countries. There is a significant amount of grant money available under ARRA for broadband deployment in rural areas. Permitting it to be allocated to providers who would not be required to provide even a modest broadband speed as the PSC has proposed would violate the spirit of the law and defeat the purpose of bringing all Americans across the digital divide with affordable broadband service.

The need for broadband is noted by an Associated Press article on April 16th reporting that Time Warner Cable is seeking to begin billing customers not only for a particular rate of speed, but for how much bandwidth they use. In other words, customer who download movies on a regular basis would end up paying more every month for broadband than someone who uses their broadband Internet connection primarily to exchange e-mails.

If systems were designed using the PSC and OT’s proposal for a 768 kbps definition of broadband, customers in rural areas who can not download large files today will not be able to download large files in the future either, be they the latest movie or a giant database or spreadsheet for a home-based employee or small business.

The PSC and OT’s apparent position that it is acceptable for some residents to have inferior (molasses slow) broadband is especially surprising since the New York State Council for Universal Broadband, in its March 9, 2009 report, defines broadband to mean “Internet access of at least one megabit per second (1 Mbps) for upload and download, as well as the infrastructure or means necessary to provide such Internet access.” This definition was not limited to non “unserved” or non “underserved” areas. The PSC comments obviously are out of harmony with voices of the same state government most concerned with broadband.

The PSC and OT comments hit closer to reality with regards to the definition of underserved areas. They argued that the definition of such areas must be flexible since there are multiple reasons why an area is deemed to be underserved. Does it have a population in excess of 250,000 people and only one or two broadband providers? Are there multiple providers, but no one is offering a service in excess of 768 kbps? Are there multiple broadband providers reaching over 90 percent of the households, but only 30 percent can afford to subscribe to the service? All of these situations are and should be considered “underserved.” The PSC and OT acknowledge this flexible definition of an underserved area and also correctly recognize that a community where the residents lack the education or skills to take advantage of broadband is an “underserved” area as well.

Where PULP differs with the PSC and OT is their statement: “Similarly, underserved can be based on a need for greater speeds and bandwidth to meet particular needs of a community such as for economic development, educational and institutional needs, and for libraries and community technology centers. Examples of applications that require higher speeds and greater bandwidth include, but are not limited to, the following: telemedicine; university research and supercomputing centers; technology centers; e-government applications being provided remotely through kiosks or satellite offices.” While these identified applications certainly do require broadband speeds in excess of 768 kbps, PULP believes that all communities need to have true broadband speed in order to fully participate in the global economy. What community doesn’t need broadband for economic development or for educational needs? – all of them do. What the PSC and OT are proposing is a continuation of the digital divide, which is the exact opposite purpose of the broadband provisions in ARRA.

State agencies from around the country submitted comments to the FCC on the topic of defining key broadband terms. The New Jersey Division of Rate Counsel's got it right when it stated in its comments:

In terms of reasonable technological expectations for consumers in the early 21st century, broadband should be defined to be offered at speeds of at least 3 mbps downstream and 1 mbps upstream, with that definition evolving frequently. However, in determining where to provide grants, those communities that do not even have broadband access at one of the three lowest tiers reported in the new Form 477 (the first tier is greater than 200 kbps but less than 768 kbps; the second tier is equal to or greater than 768 kbps but less than 1.5 mbps; and the third tier is between 1.5 mbps and 3.0 mbps) should be given priority for grants over those communities that have access to “low” broadband speeds (between 200 kbps and 3 mbps).

The establishment of a minimum threshold for speed is critically important to prevent future waves of “digital divides” where some communities’ broadband access is vastly superior to other communities’ broadband access.

For ARRA to be successful in creating jobs and boosting the economy, all Americans need to have an opportunity to be connected to the Internet with broadband speed. The lack of a clear national policy and directive during the Bush Administration, with its “goal” of universal Internet access but no “path” to get there, illustrates the need for the broadband grant provisions in ARRA. It is now official federal government policy to deploy broadband nationwide and it has backed up this priority with cash to build out in what are considered to be otherwise uneconomically viable areas. Yes, flexibility is in order, including examining policies from various states that have been successful. However, accepting 768 kbps (or slower) as an appropriate broadband speed in some areas, or believing some places may not “need” the economic development benefits or the educational aspects of broadband, grossly distorts the facts. If a company requesting a grant can not offer broadband speeds at least as fast as current DSL speeds, or, even better, the 3.0 mbps speed proposed by New Jersey, they should be rejected out of hand.

As FCC Commissioner Adelstein recently stated in the pending FCC proceeding on A National Broadband Plan for Our Future:

Broadband is no longer a luxury. It is essential if we are going to maximize the potential of every citizen to contribute to our social, cultural and economic life. We need the full input of every citizen, whether they live in rural, insular or other high-cost areas, whether they live in economically challenged sections of our inner cities, whether they are persons with disabilities, whether or not they speak English, and regardless of their income level.

Lou Manuta