Open Letter to Acting Chairman Michael CoppsTuesday, January 27, 2009
Dear Acting Chairman Copps:
Congratulations on your appointment as interim Chairman of the FCC. During the past few years, yours has always been a voice of reason within the FCC. For example, the issues you raised regarding the Third Notice of Proposed Rulemaking for the 700-MHz D Block needed to be raised and I, for one, tried to address some of them in the comments I filed for this proceeding.
You are now faced with many pressing issues including the 700-MHz D Block, the AWS-3 spectrum, the delay in the HDTV deadline from February until June, which will have an impact on a number of first responder agencies, and many other matters.
While you are addressing these and other issues, the administration and congress are crafting another stimulus package to help pull our nation out of the economic slump we are experiencing. In that package will probably be funds to help deploy broadband to citizens who don’t have access to it. My white paper, “Broadband for All Americans,” (http://www.andrewseybold.com/downloads/WPBroadband12-22-08edt.pdf) discusses this issue not in terms of technology but rather the two economic concerns that will need to be resolved: How to deploy broadband where there is no sound business model, and how to provide broadband to those who have access to it but cannot afford it.
Many believe we can solve these and other problems simply by providing additional spectrum for new nationwide or even unlicensed services. I would like to suggest that the FCC delay any and all action on both the D Block and the AWS-3 spectrum until such time as we know what is included in the final stimulus package, how much money will be available for broadband, who will administer the program, and how the funds are to be used. Further, since the Public Safety Spectrum Trust has asked for additional funding to assist commercial operators with the construction of the D Block, it would be prudent to wait until that request is acted upon one way or another.
Some are pushing for both the AWS-3 and the 700-MHz D Block to be turned into unlicensed spectrum. Their rationale is that this would promote advances in technology while providing access to this spectrum to anyone who might want to make use of it. The request to turn the D Block into unlicensed spectrum should, I believe, be rejected out of hand as that portion of the spectrum will be an important asset for first responder agencies that need access to broadband services. As for the AWS-3 spectrum or any new unlicensed spectrum including TV White Space, which your agency has already voted in favor of, while it may appear as though unlicensed spectrum will provide new opportunities both for technology and networks, I do not believe that adding more unlicensed spectrum to the pool of unlicensed spectrum now available will have any impact on the deployment of broadband to areas not covered today.
Further, as you know, over the last three or four years, many believed that using Wi-Fi in the 2.4-GHz unlicensed band to build out municipal Wi-Fi systems was one way to provide broadband to those in urban areas who did not have access. As you are probably also aware, most of these systems have been shut down due to technology issues and the technical challenges associated with keeping one common network in operation when everyone else is also entitled to use the same spectrum for their own, mostly local, uses.
Providing yet more unlicensed spectrum will not ensure that there will be practical business models that will support new networks either on a local or nationwide basis. And building such networks will not ensure that those within urban areas will be able to afford broadband and those in rural America will be served. In truth, those pushing for even more unlicensed spectrum are doing so not for the reasons publically stated, but because they perceive incumbent operators as “ripping off” the American public, charging too much for access to the Internet, and holding us all hostage.
The fact is that in the United States we pay some of the lowest rates in the world per minute for wireless voice usage and for wireless broadband data. Even so, our wireless networks that are in place are built to wired network standards of 99.999% reliability whenever possible while the cost of service continues to come down. If the FCC believes there should be even more competition for providing wireless broadband, perhaps it should be on licensed spectrum that could be auctioned with restrictions as to who is entitled to bid on it.
In most urban areas today, those who want broadband services have between twelve and sixteen choices when we include wire, fiber, cable, and the various wireless services. It is not clear to me how adding more competitors to this number will drive down pricing or provide us with a platform for renewed technology development. Over time, the market forces will once again weed out some of these service providers. The survivors will be those that have kept up with the latest technology, found ways to cut the cost of delivering packets of data down every wired or wireless pipe they control, treat their customers fairly, and provide access to the types of services customers want and need.
Providing additional unlicensed spectrum when the TV White Space spectrum has not yet been put into service does not make a lot of economic sense. If the FCC feels additional unlicensed spectrum should be allocated in the future, my suggestion is to hold back a portion of the spectrum and “bank it” without any determination as to its highest and best use until we see the results of TV White Space usage, and until we have a clear understanding of how the funds for broadband deployment will be used.
As I stated in my white paper, the answer to providing broadband for all and access for all does not lie in the creation of another network that will take ten years to construct, but rather in finding economically feasible ways to extend some or all of the networks we already have, making use of existing technology, and building not one super broadband highway but a number of highways that reach as many Americans as possible, knowing they will be fully interconnected by the Internet.
I believe the 700-MHz D Block should be successfully allocated to a joint public/private partnership and that funding must be made available in order for it to be a viable partnership. In addition to first responder services, this spectrum could be used in covering much of rural America even if it were built out simply to provide backhaul from other wired and wireless networks, again, making use of what we have and not what some hope to create.
Many states and regions have grown tired of waiting for this combined network and more regions have begun planning for their own interoperable networks that will include federal, state, and local agencies. While money is increasingly more difficult to find, they feel they can wait no longer and are planning to move ahead because of the great need and demand for interagency communications, first and foremost for voice services, and then for data. The first responder community seems to favor the concept of a network of networks built on a regional basis that are designed for interconnection on a nationwide basis.
Without a clear plan in place, these regional systems will simply sprout up and it will be more difficult as we move forward to coordinate the systems into a cohesive network of networks and more difficult to provide a commonality of devices that can be used by everyone on the network. Commonality of devices is important in lowering the cost of first responder equipment. There must be sufficient demand for the product, and that demand can be achieved by employing a single radio that can be used across all of the first responder sectors.
In summary, I would like to reiterate the points I have made above:
1) It would be wise to delay acting on the AWS-3 and 700-MHz D Block spectrum until the stimulus bill is signed and there is a clear indication of how much money is available both for broadband and for the first responder/private industry network.
2) It would be wise to delay authorization of additional unlicensed spectrum until the TV White Space is in use and it can be determined whether it is meeting the goals and criteria promised by those who were pushing for the spectrum.
3) It would be wise to not be swayed by a call for yet another nationwide network to make broadband available to all, and instead review the assets already in place to find logical, economically feasible ways to extend these networks to cover areas that remain uncovered today, perhaps combining this goal with the 700-MHz D Block auction.
4) We need to understand that providing broadband to those who cannot afford it in urban America is not about having enough competitors in the marketplace, it is about economics. In most urban environments today, monthly subscription rates for broadband services are less than $30 and in many areas less than $20. The service is available, but in order to provide it to those who cannot afford it, we must find new economic ways, not new technological ways.
5) Finally, we need to recognize that those who believe access to our highways and other provided infrastructure is free, therefore access to the Internet should be free, do not understand economics nor do they understand that access to the wired Internet is not free, so why should wireless access to the Internet be free?
Thank you for your time, I wish you success in this and all your future endeavors.
Andrew M. Seybold
CEO and Principal Analyst
Andrew Seybold, Inc.