Regulatory News - Florida Regulators, Industry Spread Broadband Plan

Posted: 10/2000

Florida Regulators, Industry Spread
Broadband Plan
Kim Sunderland

Florida Fiber Networks Inc. (www.ffn.cc),
a newly developed dark-fiber company in the Orlando area, is a company the FCC (www.fcc.gov)
loves to love.

FFN signed a contract this summer with the Florida Department of Transportation (DOT), in coordination with the Florida Department of Management Services (DMS), to create, install and maintain what could be the nation’s largest public/private fiber optic network along 2,200 miles of Florida’s Turnpike and interstate highways.

In a barter deal destined to save taxpayers $1.2 billion during the contract’s life, FFN is making ducts and fiber available to lease to any telecom company willing to spend the rent money.

But what turns on the FCC is the 2,200 miles of additional fiber FFN is installing that will help close the Digital Divide (DD) by offering low-cost Internet connections in rural areas. The result will be improved access to health, education and other social services information.

Closing the big DD is a goal the FCC holds dear to its heart. In fact, the FCC is placing so much emphasis on it, other companies throughout the United States are working their way from the densely populated cities to deploy advanced telecom capabilities in areas where the population is more sparse.

While the commission is thrilled with this trend, it still views nationwide broadband deployment cautiously, and voices its concern about pockets of communities that are at risk for not receiving the bounties of broadband.

Timely
Movement

The FCC released in early August a report that concludes advanced telecommunications capability is being deployed in a reasonable and timely fashion overall. However, it also pinpoints certain consumer groups that are particularly vulnerable to receive service in a less efficient fashion.

“The data compiled for this second Section 706 report identify some promising trends,” Commissioner Susan Ness says. “But our data also flag some very troubling trends: Some communities–especially those in rural and in economically disadvantaged areas–are at risk of not receiving the same access as other areas.”

Section 706 of the Telecommunications Act of 1996 requires FCC monitoring and the mandates the commission’s report be presented to Congress.

For the report, the commission defines advanced capability as the availability of high-speed, switched, broadband telecommunications that lets users send and receive high-quality voice, data, graphics and video using any technology.

The report’s data are based predominantly on the FCC’s first nationwide broadband survey of subscription to high-speed and advanced services. The survey required facilities-based carriers providing 250 or more broadband service lines or wireless channels in a given state to report basic information about their services and customers.

The data were compiled by ZIP codes. Providers were asked to report whether a single individual subscribed to broadband services within each ZIP code. The process left the commissioners unsatisfied.

“The available data do not provide a full and accurate picture of the state of deployment,” commissioner Gloria Tristani explains. “The data … suffer from several weaknesses that undermine our ability to draw well-supported conclusions and to identify with specificity at-risk communities.”

Overall the data show that as of Dec. 31, 1999, roughly 2.8 million subscribers nationwide received high-speed and advanced services. Of these subscribers, 1.8 million are residential or small-business customers.

The penetration rate for advanced services more than tripled, from 0.3 percent of households at the end of 1998 to 1 percent at the end of 1999, according to the report.

Of
the 1.8 million residential/small-business customers, 1 million subscribe to
advanced services, with approximately 875,000 subscribers using cable-based
services, and roughly 115,000 subscribing to ADSL. The balance subscribes to
other media.

Compared to the totals in the first report, the FCC says cable companies increased their subscribers threefold, and LECs quadrupled their DSL subscribers.

Specifically, the data show the number of cable modem subscribers jumped 150 percent in 1999, while high-speed telephone line services spiraled 380 percent during the same period.

While promising, commissioners identified several groups that are vulnerable to not having access to advanced services if deployment is left to market forces alone. They are:

"These data underscore the need to learn more about the relationship
between penetration rates and particular population groups, so that we may more
closely monitor deployment of advanced services," Tristani suggests.

She also notes the availability of data on subscribers in a particular ZIP code or data at a more granular geographic area would provide a better picture of deployment.

The commission is addressing such issues, including in an upcoming proceeding on improved access to cable networks and on how to improve the use of wireless spectrum.

If
It Ain’t Broke …

A lobbyist for the CLECs warns that attempts to rein in competition through legislation would be the wrong path to take if the goal is to speed broadband services deployment. The competitors beg for patience to allow the Telecom Act to work, which they say will result in their being able to roll out broadband across the nation.

"Once
the [Telecom] Act opened the field for competitors, broadband and DSL services
emerged from the realm of the privileged few," says John D. Windhausen Jr.,
president of the Association for Local Telecommunications Services (ALTS, www.alts.org).

“Competitors now are working as fast as they can to bring broadband to everyone in the nation,” Windhausen adds.

He reports that 400 facilities-based carriers have entered the local market since the Telecom Act was passed. They have invested nearly $30 billion in infrastructure. As a result, consumers are paying less for DSL.

“This [FCC broadband] report confirms that competition is the key to ensuring the rollout of broadband services to all Americans,” says Jonathan Askin, general counsel for ALTS. “The goal now is to ensure that appropriate mechanisms are in place to promote competition to the fullest extent possible.”

According to the FCC’s report, however, high-speed subscription rose with population density and household income.

Even in FFN’s case, its new network will supply much-needed bandwidth for the high-tech industry in Florida, state officials say.

“We have six companies already signed on to lease fiber, and we haven’t turned a shovel yet,” FFN executive vice president Carl Bagwell says.

The way the public/private contract is written, FFN gets a 99-year lease on DOT’s right of way. The company will place fiber and duct along the state’s four major interstate corridors, as well as Florida’s Turnpike.

Fiber rings will be placed around Jacksonville, Miami, Orlando and Tampa. FFN will build the entire statewide fiber optic network and provide 99 years of operations and maintenance services at no cost to DOT. The company’s financial incentive comes from potential renters.