
Broadband left out of infrastructure goals, and how the FCC wants to fix it - SmkyMt
https://www.washingtonpost.com/news/the-switch/wp/2017/03/15/the-crucial-service-trump-left-out-of-his-massive-infrastructure-goals-and-how-the-fcc-wants-to-fix-it/?utm_term=.17dfebd7ece9
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theandrewbailey
I'm cynical that this will bring meaningful improvement. Government has given
money to telecoms before, and it's only brought us mediocre service, and
brought executives huge paydays.

Where's the fiber, Verizon? We (NJ and PA[0]) gave you huge tax cuts 20 years
ago for universal fiber service. You and NYC agreed to provide everyone with
fiber.[1] Meanwhile, AT&T keeps merging with promises that are meaningless or
eventually reneged on.[2]

[0] [http://www.huffingtonpost.com/bruce-kushnick/verizon-
pennsyl...](http://www.huffingtonpost.com/bruce-kushnick/verizon-
pennsylvanias-com_b_7532008.html)

[1] [https://arstechnica.com/tech-policy/2017/03/nyc-sues-
verizon...](https://arstechnica.com/tech-policy/2017/03/nyc-sues-verizon-
alleges-failure-to-complete-citywide-fiber-rollout/)

[2] [https://muninetworks.org/content/atts-many-broken-merger-
pro...](https://muninetworks.org/content/atts-many-broken-merger-promises)

~~~
rayiner
I think offering subsidies to spur private deployment of broadband is a
terrible idea. If the market doesn't want to build it, we should think hard
about whether we should build it, and if we conclude we should, the government
should just build it.[2]

That said, the "huge tax cuts" are fictional. Teletruth's idea of a "tax cut"
is a company being able to charge any more money than they would have under
regulated rates.[1]

The "billions" in "tax breaks" are from the companies charging higher rates to
their own customers, alleged cross-subsidizing between various services that
were previously regulated at different rates, and accelerated depreciation of
infrastructure (which came at a time when major parts of the network
infrastructure were upgraded to fiber, even if the last mile remained copper).

It wasn't the government writing anyone a check, or even giving any company a
special tax credit.

Also, this bit of conspiracy theorism exactly inspire confidence in the
calculation methodology:

> Recently, (April 2015) a TV media company decided to not run an
> investigation we had worked on together about Verizon’s failure to properly
> upgrade the networks by 2015. After an interview with Verizon by the
> company, the word ‘liabilities’ entered their vocabulary and they doubted
> that there was a tax break that came with the Chapter 30 Pennsylvania
> broadband plan.

[1] That is, of course, one of the purposes of deregulation. Governments
chronically set regulated rates too low. For example, environmental groups
estimate that water/sewer rates nationally are about _half_ of what they
should be in order to account for the scarcity of water and the need to
maintain and upgrade aging infrastructure. But no elected PUC official wants
to raise grandma's water or telephone rates.

[2] And if the government does build it, we should ditch the emotional appeals
for FTTH and rely heavily on sensible, cost-effect point-to-point wireless.

~~~
AnthonyMouse
> If the market doesn't want to build it, we should think hard about whether
> we should build it

There are good reasons to expect market failure here. New players very rarely
enter infrastructure markets with existing incumbents because having to
compete with the incumbent in a natural monopoly market is not expected to be
profitable.

And the "accidental duopoly" markets aren't going to do it. Both players try
as hard as possible not to compete with each other because they both know that
increasing speeds or lowering prices would only provoke the same response from
the other and make them both less profitable.

So you're really asking whether a monopoly incumbent would do it, which
doesn't have much to do with markets at all -- it turns on whether the cost is
more than the increase in monopoly rent it would allow rather than whether the
cost is more than the value. And the existing monopoly rent is already high
because even slow internet is much more valuable than none.

> And if the government does build it, we should ditch the emotional appeals
> for FTTH and rely heavily on sensible, cost-effect point-to-point wireless.

FTTH is a one-time expense. The maintenance cost of underground fiber
shouldn't be any higher than wireless, and then you don't need to worry about
spectrum or wireless line of sight obstructions or interference or any of the
other problems with wireless.

~~~
rayiner
> FTTH is a one-time expense. The maintenance cost of underground fiber
> shouldn't be any higher than wireless, and then you don't need to worry
> about spectrum or wireless line of sight obstructions or interference or any
> of the other problems with wireless.

Most of the country doesn't bury utilities.[1] Point to point wireless is a
lot cheaper than burying fiber, and also a lot cheaper than maintaining aerial
fiber that can be torn down by storms/tree branches.

[1] My fiber line hangs free from a telephone pole and is secured in the
middle with a bent nail. But hey, that's one of the reasons my neighborhood in
nowhere Maryland has fiber, while most of Silicon Valley does not.

~~~
AnthonyMouse
> Most of the country doesn't bury utilities.

And they waste money in the long run as a result. It's the same situation --
pay once to put utilities underground and then you don't have to pay forever
fixing the fallout from every different kind of weather.

~~~
rayiner
That's great, but time value of money being what it is, you'd rather pay for
something later than paying for it now. One of the factors Google used in
choosing Fiber cities was whether the city has arial power lines versus buried
ones. Requiring cable burial is just another one of the many anti-development
measures that keeps places like Silicon Valley from having fiber when far less
wealthy places have it.

My neighborhood, in a part of Maryland where I can get to horse farms in five
minutes, has fiber. It didn't even have public water/sewer until two years
ago, but it had fiber. Tiny, non-to-code lots, arial power lines, and easy-
going permitting authorities played a role in making fiber deployment
feasible.

~~~
amazon_not
> That's great, but time value of money being what it is, you'd rather pay for
> something later than paying for it now.

That assumption only holds if the cost of the inputs do not rise with time. In
fiber builds up to 80% of the costs are labor. If/when labor costs rise more
than the cost of money then you are worse off putting off an
inevitable/intended investment.

Furthermore if putting off an investment causes duplicate costs (build aerial,
later replace with buried) or causes you to forego OPEX savings (aerial vs.
buried facilities maintenance costs), then you are actually worse off by
paying later.

Thus the time value of money is not the end all and be all.

------
gumby
> Pai is proposing an ambitious program whereby the FCC could expand corporate
> subsidies for building networks while scaling back regulations that, he
> said, deter private investment.

Given the history of the players involved (e.g. Verizon and AT&T pocketing
billions in subsidies to extend service, then paying those billions out in
dividends and doing no upgrades at all), this is clearly a case of "fool me
once, shame on you; fool me twice shame on me."

Or is this simply purchasing a nice post-government job with the taxpayer's
money?

Either way it isn't plan worth supporting, no matter how important broadband
expansion is. Or rather, "especially because broadband expansion is
important".

------
xf00ba7
The question is....does the FCC really want to fix it?

~~~
086421357909764
My thoughts are only in capacities that support the large incumbent ISP
behemoths. I would imagine establishing standards and removing city / county
ordinances restricting companies (outside of the big players) from installing
services would be a bigger step. It's ridiculous to think that some cities
want to provide better services but the lobbying arms of the big guys simply
shut it down. We have plenty of people pushing to improve broadband, it's this
incentive the rich, restrict the poor (relative to operating budgets) scenario
that's only going to be exasperated by these types of counter productive
rules.

------
petra
So basically the government will be responsible for the costs of building the
thing, but companies will own the monopoly ? and fiber will have a very long
monopoly.

This is the reverse of what will be needed in a possible, high-unemployment
future: instead of large bills, we need to aim towards extremely low-cost of
living(probably by using community owned fiber in this case).

And in general, creating jobs towards that aim, seems like a decent strategy
to transition into that high-unemployment world.

------
aanm1988
> Pai is proposing an ambitious program whereby the FCC could expand corporate
> subsidies for building networks while scaling back regulations that, he
> said, deter private investment

All hail our corporate overlords. We give you the offer of more money (in the
guise of helping consumers of course).

~~~
baldfat
(sarcasm) Yeah now my paycheck isn't going to welfare and Unions. The real
enemy of the middle class /sarcasm

