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FCC - Federal Communications Commission : Duplication Alert: Broadband Pilot Projects

03/07/2014 | 01:44pm US/Eastern
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January's IP Trials Order contained a provision to use USF dollars to fund rural broadband "experiments" designed to deliver robust, high-speed, scalable broadband service.  The language put out for comment on this new program potentially gives the FCC latitude to do any number of things in this space, including gigabit communities.

Exactly five days later, Congress spoke to this very same issue.  Included in the Agricultural Act of 2014 ("The Farm Bill") is a provision that allocates up to $50 million-$10 million per year for FY 2014-2018- to the U.S. Department of Agriculture (USDA) to create a Rural Gigabit Network Pilot Program.  To be eligible for these funds, a provider must be able to build out "ultra-high-speed Internet service" within three years in rural areas that lack such service.   

I have raised a number of concerns about the FCC's new rural broadband experiments.  First, I worry how the new experiments will fit together with the high-cost universal service reforms that the FCC already adopted in 2011 and, despite my best efforts, I have not received an adequate explanation to date.  Second, as configured, these experiments could divert needed funds away from expanding broadband access for all Americans in favor of funding very high-capacity projects for a select few anchor institutions.  Third, I am very concerned about the ability of these experiments to succeed with one-time funding.  And now, I believe that these experiments could duplicate the Congressionally-mandated gigabit pilot program.  Instead of going down this path, the FCC should rethink the need for these experiments.

If the FCC does decide to press forward with its own rural broadband experiments, I will be looking to ensure that we abide by the following principles when deciding upon any final rules or approving any experiments:

1) No Duplication.  First, the FCC's experiments must accomplish something very different from the USDA's pilot program.  As I have said before, done well, rural broadband experiments might be useful to help us determine whether additional providers would be interested in serving consumers in rural America-particularly in the event that a current incumbent provider chooses not to participate in the universal service program in the future.  Unfortunately, January's Notice of Proposed Rulemaking seems to suggest that the FCC is more interested in funding a few higher-capacity broadband projects for a few institutions, which could be very similar to what the USDA will be doing.  Second, the FCC must not fund experiments in areas that are served or will be served by USDA's pilot program or existing providers.  Such duplication makes no sense and goes against our obligation to spend every consumer dollar as efficiently and effectively as possible.

2) Rationalize Spending.  In its Notice, the FCC contemplated spending between $50 - $100 million (or more) on its new experiments.  Given the passage of the Farm Bill, which authorizes $50 million for the USDA's pilot program, the FCC needs to take this significant funding into account and scale down our own budget accordingly.

3) Ensure Qualified Participants.  The Farm Bill requires that those participating in the USDA pilot program demonstrate that they are capable of providing service.  The FCC should do no less.  We must not dedicate limited funding to wishes and whims, but only to verifiable, concrete plans from companies that can actually build and operate a sustainable broadband network after the one-time FCC support ends-because it will end.  The FCC should not approve any scenario where a new network funded through the experiments will cease to operate unless continued dollars keep flowing from the Universal Service Fund after the program ends. 

4) Don't Zap Focus.  The FCC experiments have the potential to divert limited staff resources from a main priority: following through on transforming our high-cost universal service fund into a program that is sustainable in the 21st Century.  While I may not agree with all of the 2011 reforms, the high-cost programs account for $4.5 billion annually and require considerable attention.  Staff workshops, webinars, presentations, guidance and oversight will be needed to achieve success on any new experiments.  But these take significant time and staff hours. 

Our job at the Commission is to carry out the will and direction enacted by Congress.  Given the passage of the Farm Bill, we should consider ending our own rural broadband experiments and instead focus on supporting and learning from the USDA's Rural Gigabit Network Pilot Program.

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