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Overview

In the last few years there have been major changes in the telecommunications environment. There is growing recognition by the public sector, businesses and communities that telecommunications infrastructure and services play an important role in economic transformation, sustainability and social well-being. The rise of more advanced Internet technologies has increased the demand for infrastructure far beyond the level previously needed. We are faced with the challenge of getting universal, affordable high-speed Internetdeployed, especially to under-served and un-served areas. The challenge that we face is how to get universal affordable high-speed Internet deployed,especially to under-served and un-served areas.

In order to achieve universal and affordablehigh-speed Internet, states must implement intertwining policies that increase access to, and adoption of high-speed Internet. States need to identify where access to high-speed Internetcurrently exists, develop deployment strategies to increase affordablehigh-speed Internet access and adoption in under-served and un-served areas,and develop policies that ensure community and consumer protections ininfrastructure build-out.

Core Universal and AffordableHigh-speed Internet Policies:

Map High-SpeedInternet Infrastructure

Today, a major digital divide exists between thosewho have access to high-speed Internet and those who lack access and/ or thecapability to use, high-speed Internet. Too many Americans, especially those inrural areas or low-income households do not have any Internet access, let alonehigh-speed Internet access. Mapping high-speed Internet availability andadoption, and making that information accessible to the public is an importanttool for legislators and local planning groups that wish to evaluate thecurrent status of their states’ high-speed Internet infrastructure andutilization. Such information iskey when determining where to dedicate future resources when developingdeployment strategies.

The FederalCommunications Commission (FCC)—the federal government agency taskedwith mapping high-speed Internet infrastructure and consumer access—hasbeen under attack for years by critics who claim that its high-speed Internetdata collection methods are flawed.

While the FCC was hesitant to change itspolicies, state lawmakers took matters into their own hands.

Recently, and in large part due to themomentum of state mapping legislation, the FCC finally voted to approve a newhigh-speed Internet data collection plan, focused not only high-speedInternet availability but also on adoption. Among other things, the FCC willrequire all carriers to report the number of subscribers by census tract,broken down into speed categories, and separated by residential versus businessusage. Despite the upcomingimprovements in data collection by the FCC, certain important information, suchas pricing data, is still not being collected. Further, service providers underlying data will continue tobe considered confidential.

For complete information regarding high-speedInternet availability and adoption, the following information should becollected:

  • Map high-speed Internet availability: Distinguishing different speed tier offerings, pricing information, and different service providers.
  • Collect data that can be utilized to address adoption and digital divide issues: Data is more helpful if collected at the census block, because it becomes easy to overlay high-speed Internet access with other census demographic information. Additionally, it is important to collect information about not only who has access to high-speed Internet, but which demographics choose to purchase such services. This will make it easier to determine which households are currently priced out of the high-speed Internet market versus which residents are not educated on the benefits and necessity of high-speed Internet and therefore choose not to subscribe. Lastly, the data collected should be designed to facilitate local community planning groups.
  • Distinguish between residential and commercial properties.
  • Create an authentication system: Accurate data is critical to the development and execution of good policies. Legislators should require telecommunications, cable and other high-speed Internet service providers to file their underlying data with either a public utilities commission or a third party organization for authentication.

Some states, such as WashingtonState, Kentucky, Tennessee, Ohio, WestVirginia and Kansas,have created state high-speed Internet mapping programs either throughexecutive order or legislation. These mapping programs have and will continueto pave the way for community leaders and lawmakers to develop more efficienthigh-speed Internet deployment strategies that focus on both increasedavailability and adoption. In thefuture, if more comprehensive information was collected, policymakers andcommunity organizations could better address the digital divide and lack ofbroadband competition in their states.

Most existing high-speed Internet mappingprograms could be improved by relaxing the strict confidentiality provisionsthat typically prevent the public release of data collected from high-speedInternet service providers. Manyadvocates and community organizations feel providers cannot be held accountablefor assuring that the maps produced are fully accurate without some form ofpublic oversight. California is the only state where underlying mapping datawas authenticated and analyzed by a third party entity. The California taskforce alleviated service providers’ concerns that any public release of theirunderlying high-speed Internet infrastructure data would be given as tradesecrets to competitors negatively affecting their business, by having datacollected by a third-party agency, not the public.

State efforts should therefore focus onmapping the data that the FCC is missing, creating user friendly websites thatwill allow the public access to the data collected, using the federallycollected data to develop deployment strategies and working with serviceproviders to establish a data authentication process.

Resources:
FCCMapping Order
ProgressiveStates, Mapping and Deploying High-Speed Internet
California BroadbandTaskforce

Communication Workers of America -SpeedMatters: Affordable High-Speed Internet for All
Connected Nation

Deployment Plansand Partnerships

Once under-served populations are determined, affordable high-speed Internet needs to be deployed to these individuals. The first step to successful deployment of broadband Internet infrastructure is for states to create broadband authorities, consisting of diverse stakeholders, to develop a smart deployment strategy.

High-speed Internet authorities provide a forum for public/private collaboration and “big picture” policy direction. Any legislation establishing an authority should require the council consist of diverse members representing various stakeholders and experts with the express purpose of protecting municipalities’ rights, and establishing clear deployment and adoption goals and accountability metrics.

 

An authority should have strong representation froma range of community members, including local community planning groups, publicinterest organizations, education professionals, health care providers, publicsafety employees, labor groups, and state and local government leaders. It is crucial that legislation ensuresthat if telecommunication and service providers are part of an authority that they are balanced fairly by community voices. Providers should not have enough seats to constitute avoting quorum, since this would open up thepossibility of biased findings, and hinder the committee's ability to protectthe public interest. This past legislative session, a few states createdhigh-speed Internet councils, although some of these councils included too many industryrepresentatives:

  • West Virginia House Bill 4637 created a Broadband Development Fund and a Broadband Deployment Council. The Broadband Deployment Council, will provide for the development of a strategy and mechanism to be employed in extending broadband access to every West Virginian by stimulating demand for those services, and by constructing the necessary infrastructure to meet that demand.
  • Minnesota Senate File 1918 is a forward looking bill, which establishes an Ultra High-Speed Broadband Goal Task Force. One of the responsibilities of the task force is to make specific recommendations identifying a level of high-speed Internet service and connection speed that will be needed by the year 2015.
  • Washington State enacted a bill that uses an intra-government partnership approach to ensure that deployment of the Internet will provide smart utilization in addition to increased access. Senate Bill 6438 requires a public-private partnership including representatives of organizations representing education, health care, economic development, community development, local government, telecom providers, tech companies, and telecom unions to develop a comprehensive and integrated statewide, high-speed Internet deployment and adoption strategy. The partnership’s goals include: (1) working to ensure that all residents and businesses have access to affordable and reliable high-speed Internet services; (2) achieving improved technology inclusion; (3) establishing and empowering local technology planning teams to assist in technology inclusion efforts; and (4) establishing and sustaining an environment ripe for statewide telecommunications and technology investment.

Further, broadband Internet deploymentcouncils should include language to protect municipalities’ ability to buildtheir own networks. Forexample, Illinois SenateBill 2244, the High Speed Internet Services and Information Technology Actof 2008, included a specific statement making it clear that nothing in thedeployment council enacting legislation should be construed to limit theability of any municipality, county, or other unit of local government toundertake local high-speed Internet projects and related functions.

Resources:
Final Report of the California High-speedInternet Task Force - State ofConnectivity: Building InnovationThrough High-speed Internet
Progressive States - Mappingand Deploying High-Speed Internet
Educause White Paper, A Blueprint for Big Broadband

 

Fund Deployment

Many states havecreated funds to help encourageprivate sector investment in high-speed Internet infrastructure. These states typically employ matchinggrants to improve the financial feasibility for service providers to expandoperations to previously un-served areas. Other states have issued direct funding for projects or research,including the creation of public sector entities that use state funds toconstruct and lease high-speed Internet infrastructure.

  • In Vermont, public sector funds were used for the purchase and construction of high-speed Internet infrastructure. The Vermont Telecommunications Authority (VTA) is charged with bringing affordable high-speed Internet service capable of transfer rates of at least 1.5 megabits per second, and increasing speeds in the future, to every Vermont household by 2010. The state was permitted to provide the Authority with up to $40 million in bonds to back projects in the first year of construction and possibly more. The initial target is to leverage more than $200 million in private sector investment with the state’s backing. Repayment of borrowing for the projects will be based on revenues generated from leasing access to the infrastructure, such as fiber-optic networks and space on towers, or the revenues from services provided over the network.
  • Maine created the ConnectME Authority to expand broadband and cellular infrastructure throughout Maine. The statute authorizes the ConnectME Authority to assess every communications service provider an annual fee not to exceed 0.25% of revenue received or collected for all communications services provided in the state by the provider. The fund received up to $500,000 in "seed money" annually for at least the first two years to accelerate private investment in communication services.
  • The California Advanced Service Fund (CASF) was established by the California Public Utilities Commission in December of 2007 as an expected two-year program to (1) provide high-speed Internet services to areas currently without broadband access and (2) build out facilities in underserved areas if funds are still available. The program has been allocated a total of $100 million, and will provide matching funds to qualified certified applicant carriers for up to 40% of the total project cost for the deployment of high-speed Internet infrastructure. CASF is funded by a 0.25% surcharge on end-users’ intrastate telecommunication bills.

Another way states could potentially fundhigh-speed Internet development and adoption, especially in under-served andun-served areas, is through the use of universal service funds. In the telecommunications context, universal service refers to thepractice of providing a baseline level of telecommunications services to everyresident of the country. States collect a portion ofuniversal service funds fees on intrastate phone services to help keep phonecosts down in rural and urban areas. High-speed Internet is the next generation of telecommunications. It can support telephone services andmore advanced applications. Therefore,states should redirect portions of the state universal funds towards supportinghigh-speed competitive and technology neutral Internet connections, or to helpsubsidize households who cannot afford a high-speed Internet subscription.

Resources:
Progressive States - Mappingand Deploying High-Speed Internet
Educause White Paper - ABlueprint for Big Broadband
AnnualReport on the Activities of theConnectME Authority
California AdvancedService Fund
Vermont Telecommunications Authority
, http://www.telecomvt.org/
e-NC Authority

Protect MunicipalHigh-speed Internet Networks

Wireless and wired technologies allow municipalities to offer a means to bridge the digital divide. Communities are now building their own wired and/or wireless “Community Internet” systems,using fiber optic cables or unlicensed space on the public airways to providedependable high-speed Internet connections to homes all across America.

Municipalities seeking to provide affordable high-speedInternet to their residents have had to deal with special interest legislationat the state level designed to shut down municipal networks. In an effortto stifle competition and protect their profits, service providers are pushing billsin state legislatures that would prohibit communities from setting uphigh-speed Internet networks, prevent competition and undercut localcontrol--even in rural and low-income areas not currently served by largeproviders. More than a dozen states now havelaws on the books restricting cities and towns from building their ownhigh-speed Internet networks.

New technology is making it possible for cities and townsto improve access to information, provide education and job training, enhancepublic safety, foster technological innovation, and bolster local economicdevelopment. State laws shouldprotect, not block, the development of municipal systems, public privatepartnerships, and other alternatives that promise to bring the benefits ofhigh-speed Internet to more people.

  • In Vermont the state legislature adopted Public Act 79, which, among other things, granted towns and cities the right to deploy their own high-speed Internet infrastructure. The legislation supports such measures both by a blanket approval of cities and towns to deploy broadband infrastructure and by granting access to the Vermont Municipal Bond Bank to help with these projects. Twenty-three towns have already banded together to build the East Central Vermont Community Fiber Network that will connect under-served homes and businesses.
  • Under the terms of Minneapolis, Minnesota wireless project, which many consider the most successful municipal high-speed Internet program to date, the city functioning as an "anchor tenant", paying $1.25 million a year for the city's own use of the network. Since the city agreed to be the “anchor tenant,” U.S. Internet built the high-speed network with no public financing. Additionally, U.S. Internet is providing a comprehensive set of community benefits that surpass negotiations by other cities in the country, including a $500,000 payment to create a “digital inclusion fund” that will be used to promote affordable Internet access, low-cost hardware, local content and training. In addition, U.S. Internet will direct a minimum of five percent of the network’s net profits to a digital inclusion fund for ongoing digital inclusion efforts.

Resources:
Free Press - Community Internet Background
Institute for Local Self-Reliance - Municipal Broadband:Demystifying Wireless and Fiber-Optic Options, MinneapolisWireless Project
Common Cause - CommunityBroadband
DigitalAccess

StateStatewide Video Franchising Reforms

Statewide video franchising agreements,enacted in many states, have undermined consumer protections previouslyprovided by local franchising agreements. Analysisof the effects of statewide video franchises found that consumers in statesthat have enacted statewide franchising laws have seen their cable servicebills go up 8 to 50 percent, depending on the level of service. Further, consumer's complaints, instates with statewide video franchising, remain high with 74% of surveyrespondents reporting no reduction in the level of complaints.

Despite the evidence to the contrary, serviceproviders have argued for years that the streamlined process of statewide videofranchises, instead of local franchising agreements, could have benefits forthe public; such as slightly increasing competition or facilitating a morestrategic statewide universal deployment plan. These providers with interests in breaking into the TV industry, have putintense pressure on legislatures to adopt statewide video franchises. The problem is that industry playersoppose the public interest requirements that always have gone hand-in-hand withfranchise deals.

In the 2008 session, lawmakers in both Tennessee and Louisiana, joined 18 other states, whoallow for statewide video franchises. The legislation in both states reflect the worst of the bad policiesfrom franchise legislation enacted in other states, including minimal, if any,build-out requirements, limits to municipal power and insufficient support toPEG stations.

The negative results of statewide videofranchising emphasize how crucial it is that franchise agreements protectconsumers and ensure affordable access to high-speed Internet. States must protect community services,build-out requirements and PEG stations.

  • Build-out Requirements: As legislatures consider franchising legislation, they must confront how companies will be required, over time, to offer service to all communities. The best method to ensure that discriminatory redlining does not occur — and to bring video competition to every household — is to require franchise holders to build-out their services on a reasonable timetable. It is important that states not only specify build-out requirements, but also establish oversight mechanisms to ensure negotiated build-out actually occurs. Some of the best build-out requirement language was proposed in New York A03980, which would have required video service be provided to half of the state's consumers within three years and to 85% percent within five years. Companies selecting the state franchise were not allowed to reduce existing service and redlining could bring on fines.
  • Public, Educational and Governmental Channels: Public Educational and Government (PEG) channels are often the only remaining media outlets that broadcast local voices, cover local issues, and show exactly how local governments work. They also allow for targeted programming to reach particular segments of the community that might not be served by major outlets. In order to protect PEG stations, states must first ensure that statewide video franchises do not reduce or eliminate PEG funding and support. It is also important that states include regulations in statewide video franchising to ensure providers carry PEG channels on the most basic tier of service so that the channels are accessible to any individual with a television, regardless of income level or cable package. Michigan legislators, in an attempt to keep PEG on the basic tier, drafted HB 5693, to require that cable providers keep their government channels available to subscribers without requiring the need for additional equipment (unfortunately only until 2009 when all channels go digital). Michigan's amendment uses language similar to that in California's state video franchising legislation, AB 2987, which required that PEG channels be receivable by all subscribers.
  • Protecting Municipality Power, Community Benefits and Consumer Protections: Statewide video franchising legislation should protect municipalities’ rights to provide high-speed Internet to their residents, allow local communities to collect or share in franchising fees, and provide consumer protection mechanisms that provide fair outlets for customer service complaints.

Some statelegislators have taken steps to rebut the negative trend of statewide videofranchising legislation. InMinnesota SF3337 directs the Department of Commerce to request a study to analyze theimpact of enacted statewide video franchising legislation in at least threestates. This thoughtful approachensures that before Minnesota takes any action, legislators have accurateinformation on the potential effects of statewide franchising and what consumerand municipal protections must be included. In Maine, legislators developed ModelMunicipal Franchise language that has a large portion of the terms alreadyagreed upon by telecommunications companies and ensures that local communitiesnegotiate for important consumer protections. The model bill is an attempt to streamline the franchisingprocess without circumventing municipal power.

Resources:
New Rules Project - InformationSector Policies
Educause White Paper - ABlueprint for Big Broadband
National Association of TelecommunicationsOfficers and Advisors (NATOA) - Understandingthe Impact of State Video Services Legislation
Free Press - Video Franchising
Telecommunications AdvocacyCoalition - Why LocalControl?
Alliancefor Community Media

Consumers Union, Elementsof Consumer Friendly State Franchising Legislation