FCC: Broadband not being deployed quickly enough

Large and small telcos are lining up on opposite sides in response to a report issued by the Federal Communications Commission yesterday that found that broadband service is not being deployed in a “reasonable and timely” manner.

The report, based on data provided by service providers for December 2008, found that between 14 million and 24 million U.S. residents (which is about 4.5% to 8% of the U.S. population) cannot get broadband where they live. The FCC is required to issue the report annually and all previous reports have found that broadband was being reasonably and timely deployed.

The FCC clearly hopes to use the report results to help advance its plans for transforming Universal Service from a voice-centric to broadband-centric program. Without substantial reforms to the agency’s Universal Service programs, these areas will continue to be unserved, denied access to the transformative power of broadband,” wrote FCC Chairman Julius Genachowski in a statement.

Both AT&T and Verizon issued comments protesting the finding. “It makes no sense that, after the National Broadband Plan concluded that 95% of Americans have access to wireline broadband, the FCC majority now suggests broadband deployment is not reasonable and timely,” said Kathleen Grillo, Verizon senior vice president for federal regulatory affairs, in a statement. “The report’s conclusion is hard to understand, given America’s extraordinary progress in deploying broadband, fueled by hundreds of billions of dollars in private investment.”

But the Rural Cellular Association President and CEO Steven K. Berry praised the report. “I am glad the FCC recognizes that broadband deployment has been slow-moving,” he said in a statement. “The FCC’s report correctly concludes that there is more work to be done in order to ensure that all Americans, especially those in rural and hard-to-reach areas, have the capacity to access broadband services.”

The FCC’s reversal of previous findings resulted, in part, from a change in how the term “broadband” is defined. In previous reports, any connection providing at least 200 kb/s bi-directionally was considered “broadband.” In the new report, broadband was defined to include any connection supporting download speeds of at least 4 Mb/s and upload speeds of at least 1 Mb/s.

The two Republican FCC commissioners dissented on the report findings. “Broadband infrastructure deployment and investment are a remarkable and continuing success story, and I am troubled by giving such significant efforts a failing grade,” wrote Commissioner Meredith A. Baker in a statement.

Baker also expressed concerns about methodology. The 1996 Telecom Act, which requires the FCC to issue the annual broadband report, is “not technology specific,” Baker said “yet this Report limits its findings to terrestrial solutions.”

The Republican commissioners, along with AT&T and Verizon, expressed concerns that the FCC might use the report findings as a justification for what Grillo called “rolling back bipartisan pro-investment policies.” The FCC is seeking to expand its authority over broadband services because without the expanded authority, the commission might not be able to reform the Universal Service program to cover broadband services. But the large telcos are concerned that if the FCC expands its authority over broadband, Net Neutrality requirements also will be expanded.

Other recent FCC data suggests the number of unserved Americans is closer to the low-end of the estimate released yesterday. In May, the FCC put the number of unserved households at 7 million, representing about 14 million people.