Posted on 01/24/2017 4:39:56 PM PST by 2ndDivisionVet
Federal Communications Commissioner Ajit Pai dropped his agenda Tuesday to speed up deployment and delivery of broadband internet in America’s typically underserved rural areas, laying out a plan to encourage gigabit speeds in some of the poorest parts of the country.
The Republican commissioner outlined the major tenets of his plan during a speech at The Brandery, a Cincinnati-based startup accelerator, where he called for more center-right, market-based approaches than those typically sought by the FCC’s three-Democrat majority, including tax incentives for internet service providers (ISPs), entrepreneurs and a streamlined regulatory permitting process for wireless and broadband infrastructure.
“The concept is simple,” Pai said. “Provide financial incentives for internet service providers to deploy gigabit broadband services in low-income neighborhoods. Incentivize local governments to make it easy for ISPs to deploy these networks. And offer tax incentives for startups of all kinds in order to take advantage of these networks and create jobs in these areas.”
Pai, who hails from rural Kansas, said he’ll lead the charge by calling on Congress to “create Gigabit Opportunity Zones,” areas with average incomes below $40,243 where ISPs would qualify for federal tax incentives in exchange for building networks boasting 1,000 megabits per second download speeds, far exceeding the FCC’s minimum definition of broadband speed of 25 Mbps, and the U.S.’s average of 31 Mbps.
With those incentives, ISPs “would be able to immediately expense all capital spending associated with bringing gigabit services to residents and businesses” and “carryover any losses for up to seven years, giving new ISP competitors with less revenues a strong incentive to enter the market.”
Startups in those areas would be eligible for federal tax credits “to offset the employer-side payroll taxes for any startup employee who works in a Gigabit Opportunity Zone.” To qualify as a zone, state and local governments would have to adopt deployment-friendly policies with streamlined deployment and siting processes.
“And it will incentivize civic leaders across the country to qualify so that they can publicize the fact that their communities are open for jobs, opportunities, and economic growth,” Pai said. “Gigabit Opportunity Zones would be a powerful tool for closing the digital divide that too often separates the haves from the have-nots.”
The second part of Pai’s plan deals with increasing access to mobile broadband in the most rural regions of the U.S. lacking wired network infrastructure, where wireless is the only choice for residents. To do that, the commissioner said his own agency should change 10-year spectrum licenses requiring wireless carriers to reach 75 percent of the population to 15-year licenses with a requirement to reach 95 percent.
Without the mandate, Pai said carriers have no incentive to expand beyond the minimum. In return, they’ll get to hold onto the airwaves for another five years, justifying the expense. A “rural dividend” of 10 percent of the proceeds from future FCC auctions for spectrum licenses would go to support rural broadband deployment.
He also called for a revamp of the FCC’s Mobility Fund, which shells out $400 million from the FCC’s Universal Service Fund “each year paying two, three, or even six wireless carriers to overbuild each other and displace private investment.” Instead, he said the FCC should set minimum service requirements in order to hold recipients of the funds accountable and uncap it “to what it takes to get the job done.”
Pai said the FCC should use its congressional authority to preempt state and local laws that slow or bar the deployment of wireless and broadband infrastructure, and do so well ahead of the national rollout of 5G, which will require more dense infrastructure than any before.
To that end, he said Congress should give the FCC the power to regulate rates for pole attachments — when providers add fiber, coaxial or other wires to existing poles — make “dig once” a national policy, so that for every road built, a fiber conduit is laid accordingly, and streamline the permitting process through all federal agencies for building broadband infrastructure on federal lands.
Lastly, he stumped for representatives of the sharing economy like Uber, Airbnb and Kickstarter, increasingly facing regulatory barriers meant for the incumbent players in the industries they’re disrupting. Though many are beyond the FCC’s jurisdiction, Pai said that shouldn’t stop Congress from deregulating or reforming taxes for startups and disruptors.
“So should Uber, Lyft, and other ride-sharing companies be regulated like taxicabs? No. Should Airbnb abide by the longstanding rules of the hotel industry? No. Should Tesla have to pay middlemen (car dealers) instead of selling directly to consumers? Of course not. If municipalities are going to serve their citizens, they should embrace innovation as a consumer good, not as a threat.”
We have an optical fiber pipe to a small farm in MN, installed under this sort of program a few years ago, and no one lives there. NO, get gigabit running in the urban and sub-urban areas! Sheesh!! The hogs and chickens don’t need it!!
Rural??, what about cities..they dont have it either
Wrong. A lot of the rural counties are turned down by soft industry and local good jobs are lost because of no high speed internet.
Pai makes some very good points here such as dig once.
We need incentives like the ones that got the USA rural electricity during the first part of the 20th century.
I wish Pai could stop, and pull back, spectrum hoarding that takes place with the spectrum auctions. Bidders with big bankrolls buy up spectrum leases with no intentions to actually put to use all of that spectrum, not even by the end of the lease. They are hoarding it hoping to get a better price later on, when permitted, but meanwhile, lesser funded outfits with actual startup plans lose out in the bids for available spectrum, often to the hoarders. COMCAST who has no broadcast or cell phone service bought tons of spectrum in the last auction, outbidding some small wireless startups in under served areas. Pai should address this.
I live in the city, and I don’t have gigabit broadband. My choices are Low tier Comcast, or DSL. DSL sucks. The low tier comcast suits my needs. Would I like faster? Sure. But not at the prices they want to charge me.
I had a grandfathered Verizon plan with 25 meg up and down through fiber to the house. Just looked at Frontier, and the best they are offering now to new customers in bundles is 12 meg, with the main plan being only 6 meg, although digging around under separate tabs I did see a stand alone at 24 meg and one at 30 on a different page. Looks like they don’t want to encourage cord cutters.
The hogs and chickens might not need broadband (but then again they could) and the farmers definitely need it.
Farming is becoming data intensive like other industries. And if it comes down to a choice of which areas should get broadband first, then why shouldn’t it be solid red areas?
Rural areas first, cities second. Think rural renaissance. Our team comes first.
There’s a lot of dark fiber already. A lot MORE was laid to create shovel-ready jobs gas part of Porkulus, including $65 million worth near me. But I still have exactly the same number of ISP choices as before because no one has created a viable business plan to light it up. Pai is pushing a solution in search of a problem.
“And if it comes down to a choice of which areas should get broadband first, then why shouldn’t it be solid red areas?”
Great point!
In my town using CenturyStink our download speed is .7mbs - Netzero phone line is faster, almost.
>>>. And if it comes down to a choice of which areas should get broadband first, then why shouldn’t it be solid red areas?
Why should the federal government be involved in picking winners and losers at all. If folks need gigabit, let the market provide it.
Hot Damn - now THAT is an infrastructure buildout I can support!
Some people choose to live in the inner city, which has its upside and downside.
Some people choose to live in the burbs, Some choose to live in the boonies.
Americans vote with our feet where to live. That is what immigration is all about. I left Kent WA for Tukwila and then for Wheaton IL and then for the inner city and then Chicago’s burbs and then downstate and then Atlanta Ga. Under 1% of my neighbors in any of those locations were born in the community. Over 99% chose to live there. They chose not to move.
So why should the government get involved in subsidizing one choice over the other? Why should the Feds do anything special for rural residents? Or for residents who choose to live in a flood plain? Or for you? Or me?
I’m sure the 107 people who live in Hayes, SD will be thrilled, but the rest of us will have to pay for their giga bite Internet. As long as we are trying to help those who live in rural areas access to everything why not a government subsidized Starbucks too.
And our opposition will reward our philosophical virtue by beating us to death with it.
Public infrastructure serves a public purpose. I don’t buy off on this neo-libertarian fantasy where everyone pays for their own usage of public services like roads, sewers, communication infrastructure, police, etc.
“As long as we are trying to help those who live in rural areas access to everything...”
Not, everything, just gigabit internet speeds, and in many case, non-dial up internet for the first time. Since in many of these rural areas lines are going to be burried for the first time, why not make them 5G compatible? There’s millions of children being raised in conservative families in our nation’s rural areas, many of them home schooled. Personally, I like the suggestions Pai has made. You can keep your Starbucks.
It’s not cost effective to lay either copper or fiber boradband in areas where there’s only one house per quarter mile down a country road.
Without subsidy, it will not happen.
And Satellite will always suck because you cannot exceed the speed of light.
Good internet requires urban density.
I am rural and actually could do everything I NEEDED on the internet at 56k dialup. High speed internet is necessary for smooth high definition video.Not needed for ordinary banking,etc.And my DSL internet at $19.95 wasn’t the strain on my budget that the $54.95 fiber optic is.With the installation of fiber in my rural area the plain old telephone services are gone,the copper abandoned.And if the electric goes out so does the phone .
I disagree that everyone needs to live on a superhighway be it real or virtual.
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