Matt, Although I agree with most of what you say, specifically there are huge risks that USF will just go straight to the Cellular carriers to build out more mobile phone towers to deliver broadband. In order to win a battle to dispand USF, we have to effectively combat other's objections to that.
What would you propose we respond to the following common objections.... 1) Alaska - Full of Icy sub-zero weather, surrounded by frozen water, very rural. Without USF subsidee not only would communications providers fail, but the people that are served would be at severe risk. These communicatiosn are absolutely necessary for healtch care and public safety. The alternative optiosn to communbicate jsut dont exist. This territory can be the most expensive and challenging to serve. Without USF, these Americans will be left out in the cold. Alaska has some very influencial senators/legislators protecting USF. 2) If a Rural Telco fails, consumers will be left without communications. Shouldn't competitive provider options be available to all homes, before the solution in place that works is dispanded. How can we be certain that Rural Telcos will be able to survive without their subsidees? To get their subsidees in the first place they likely had to prove their need, in order to qualify. Other than just self-perception, what evidence do we have to support our claim, that Rural USF recipients can survive without the continued subsidees? 3) Rural America needs better mobile phone coverage. Subsidees are needed, thats why coveratge is not there now. If USF got disbanded would it reduce the subsidees to Mobile carriers, or would it indirectly steal future funding sources WISPs? If mobile expansion funding is not gotten from USF, a fund that already exists and does not come from WISP's pcoket, where will it come from. If mobile is needed, something needs to pay for it. Will future funding opportunities and programs get redirected to mobile instead? Lets specifically look at West Virgina and BTOP/BIP. West Virginia got probably the largest grant of any ARRA recipient of about $130 million. I Personally thought it was an outrage. Most of the funds will go to pay Frontier to build fiber backbones, and Verizon to build out Mobile cellular towers and LTE. Making Verizon,the wealthiest RBOC one of the largest recipients of ARRA funds. Ironically, Verizon plled out of West Virginia as the ILEC, not to long ago. And now instead West Virginia pays them to come back to deploy mobile. This was the recommendation of the State officials, and strongly pushed from West Virginia Congressman, involved in congressional Broadband committee. The arguement was that mobile coverage in West Virgina was horrid and desperately needed. Many will argue mobile phones are more important than Broadband. Cell phones are a success stories, with 3-5 phones per household now adays. If the cellular phone tower needs to be build anyway, isn't it a better use of funds to take advantage of that infrastructure to also colocate a form of broadbnd wireless? Saying we dont want subsidees to go to mobile carriers may not get support by rural consumers nor policy makers, considering that mobile carriers also own license spectrum to deliver more sustainable operations, so they will argue. Now there is nothing more than I'd like to see is to stop subsidees to mobile phone carriers. They have more than enough revenue in urban and suburban America to self fund rural America mobility. That is something that is proveable, jsut by looking at public stock info, and the huge rate of growth the industry has had. It doesn;t need help. If the goal is to disband USF, it may be worth reaching out to NewJersey's congressmen. They are one of the largest payers into the fund, and their congressman have been very vocal about disbanding USF, and stopping the financial burden put on NewJersey residents. Any New Jersey WISP constituents on-list? What I'd like to see is tax credits go to third party investors that contribute to equalizing the industry. For example, tax credits to investors that invest in companies doing less than $10million a year in revenue. Tax credits to tower companies that colocate/lease to atleast one local WISP (such as one doing less than $10million a year with a local office). In otherwords give help to those that help companies that are looked at as higher risk. I'd like to see fed help grow an industry of competitors, not just cater to consumer demands through monopolies. What we really need to do is get Congress involved and convinced that they need to mandate "support for small business", and "prevent funding of any monopoly behavior", before any future funding or subsidee programs get reformed or formed. Tom DeReggi RapidDSL & Wireless, Inc IntAirNet- Fixed Wireless Broadband ----- Original Message ----- From: "Matt Larsen - Lists" <li...@manageisp.com> To: "WISPA General List" <wireless@wispa.org> Sent: Friday, May 28, 2010 3:53 AM Subject: Re: [WISPA] How the FCC Proposes the Regulate Broadband > Mark, I would like to thank you for your interesting and obivously well > thought out post. > > I am firmly of the camp that USF should be completely discontinued, and > my efforts going forward will be to encourage its disbandment. The > major goals of the original USF program have been completed for some > time now, and the program is no longer needed. USF is providing > unneeded subsidization of wireless cellular carriers, some very large > corporations (CenturyLink) and many rural ILECs that take USF money and > use it to warehouse spectrum and compete with WISPs. > > The politically correct thing to do would be to find allies for our > other positions and offer to support USF reform that will be inclusive > of WISPs. I have had enough experience with the paperwork, legal > wrangling and political skullduggery at the state and federal levels > involved in getting USF to recognize that it is almost totally > incompatible with WISPs. USF is HURTING the deployment of broadband in > the US by supporting the entities that have either failed to deliver > broadband to many of their rural service areas (CenturyLink), have > delivered broadband but are now using the funds to subsidize other > activities such as spectrum warehousing (many small ILECs) or are using > it to fund the buildout of cellular networks (cellphone companies) that > provide awful coverage in rural areas. > > From a philosophical and practical standpoint, USF should be > abolished. The funds left in their coffers can be used to establish a > smaller, tightly focused program for schools and libraries - entities > that are legitimately benefitting from USF. > > USF has strong support from telcos and they are great at focusing on the > tiny parts of the program that are beneficial and the threat that some > telcos will "go under" without USF support - while the vast majority of > the money that comes out of USF goes to the bottom line of profitable > companies with ties to the original monopoly players. > > It is time for a quick lesson about the economic concept of "Fast > Failure". One of the very best features of capitalism and the > entrepeneurial environment of the United States is that a business can > and should fail if it turns out to not be economically feasible. When > that business fails, its resources are redistributed and another > business can step in. Subsidizing a business that doesn't need > subsidization, or creating a monopolistic situation through > subsidization or regulation leads to inefficiencies in the system. USF > is being used to support businesses that don't need the support and it > creates an anti-competitive environment. > > I would really like to see USF disappear. It just doesn't make sense > to me to try and work with a system that is hopelessly flawed and > unrepairable. > > Matt Larsen > vistabeam.com > > > On 5/27/2010 3:55 AM, MDK wrote: >> As I write, is it 1:40 AM, I'm tired as heck, but have been mulling this >> question for days, and have finally taken the time to do this. First, >> to >> my self-motivated "enemies" who can't stand anything I say "Nuts!", I'm >> right and I know it. Now, for the rest, who are interested in more than >> just shallow mockery, here's serious conversation on serious topics, and >> the excuse to dismiss me for those who can't bring themselves to be >> serious. >> >> Some comments on the strategy for opposing FCC intervention. >> >> As is highlighted below - and has been discussed at considerable length >> in >> other venues... The NBP, the regulation of internet services, and "net >> neutrality" all hinge upon a couple of rather firm anchors. As we know, >> the FCC lost in the courts when it attempted to simply re-write the >> intent >> of current law. The first "anchor" for implementation of anything is >> to >> surmount the law as it sits right now. Either by Congressional action, >> or >> by administratively bypassing it. >> >> The current administration has demonstrated in several other areas they >> are >> willing to coordinate completely bypassing the legislative process, and >> regulate via "administrative rule". IE, agencies simply write new rules >> that force the intent of the administration, even if it conflicts with >> current law, or has no basis in law. There's considerable example and >> evidence of this, by the EPA and other agencies. >> >> It would be my estimate that this is the approach the FCC will try - and >> it >> is coordinated directly, but unofficially, from the White House. This >> approach has mixed support and resistance in Congress. Some of the >> Democrats would prefer this, rather than Congress taking up a >> controversial >> topic. However, it is legally "iffy". And, there's a majority in >> Congress which is mostly Republicans and some Democrats who actually >> oppose >> the FCC attempting to simply rule by fiat. It's a "turf" thing, >> actually. >> Few in Congress are strongly supportive of enterprise, and the resistance >> is >> mostly about Congress objecting to the FCC usurping their role. >> >> Thus, it would seem to be a poor strategy to rely on Congressional >> efforts >> or even lobbying Congress to proactively act - though it should be done - >> to >> oppose the FCC, perhaps by proactive legislation, to block the FCC from >> doing any of this. It's a poor strategy to depend on it happening, >> but >> that happening would be probably the best possible outcome - assuming the >> law passed would protect our freedom to be in business and STAY >> unregulated. >> >> As I said above, there are some key pins on which this whole thing >> revolves, >> and it has been pointed out, that USF funding - and a re-write of that >> tax >> and spending is key. It's the "carrot and stick" approach. Not quite >> the traditional meaning, but the carrot used to get you closer or to >> agree, >> so you'll get close enough to beat with the stick. >> >> So, MONEY is the key. If there is no MONEY to buy your acceptance >> with, >> there is near universal industry opposition to regulation. In that >> situation, we could be political allies with, and benefit from the >> lobbying >> warchests of a wide array of players in the telecom and internet >> industries, >> as well as a wide array of both ideological and even some "progressive" >> institutions. >> >> As long as there is money on the table - as long as any administration or >> agency or even Congress has the means to buy off resistance - there is no >> reliable massive block of resistance. As was pointed out in other >> emails, >> an alliance with small and rural CLEC's and others is going to be shaky, >> because if the regulators put money on the table for them, they abandon >> the >> "common defense" and we're on our own. >> >> For that matter, WISPA's membership and even just the readership of this >> list is extremely and deeply divided. There are those who see the >> purpose >> of WISPA as one to lobby to repurpose or redirect the flow of that money >> to >> them. Yet, as pointed out later in the discussions on this list, that >> very funding means is going to be extremely anti-competitive, and result >> in >> near monopolies by area, region, etc. Support for USF funding to ISP's >> is >> 100% at cross purposes to the best interests of our industry's many >> individual members. >> >> WISPA has finally reached that point where it is no longer able to bridge >> this gap. The gap is wide enough, the fence tall enough, or whatever >> metaphor you wish to choose, so that the choice literally has to be made. >> WISPA leadership has attempted diplomatically to attempt to tread both >> paths, but now they diverge. Either WISPA advocates for a patently >> anti-competitive industry subsidy, or else it become against such subsidy >> altogether. There is no future point where this straddling again >> narrows >> and the leadership can advocate both for USF money subsidy and still >> claim >> to be for ALL WISP's, and for the interests of all us in a free and >> competitive market. >> >> At this point, since WISPA is "representative" of its members, it's time >> to >> ask the members which way they wish to go, and ADOPT IT OFFICIALLY. >> Stop >> dissembling between completely opposing ideas - advocacy for the >> permanent >> subsidy USF funding has become as opposed to the free market, free >> enterprise competitive marketplace we MUST HAVE TO THRIVE. >> >> I would be remiss in not at least attempting to advocate for an >> alternative - as we know, Congress likes "reform", but HATES "ending" >> anything. So, we advocate for - and this advocacy can and would gain >> near >> universal support from almost all players, as most are rational enough to >> see the wisdom in it. It is also self extinguishing - meaning it is >> both >> responsible and attractive politically. >> >> I'm not going to broach the "POTS" element of USF, only the conceptual >> notion of subsidizing broadband deployment - presuming this a mix of >> congressional funding, USF funding, or other, or any or even none of >> those. >> >> First, we need to recognize that both middle and final mile are at issue, >> in >> terms of broadband for areas which currently lack it, or have >> uncompetitive >> or excessively priced services. Second, that "satellite" is fully >> outside >> the realm of any of this, that satellite is not eligible for, nor >> qualifiable for, solid infrastructurally sound broadband delivery. >> >> Next, we need to address fundamental questions - Ideas must be sellable >> to >> Congress, they must obtain at least a modicum of support, and they >> should >> be equitable to all - putting free market principles to work. It must >> not >> institute permanent subsidy, which discourages the establishment of >> business >> models which are fundamentally sound WITHOUT public money. >> >> I would suggest the following approach, that is two-pronged. One, is to >> implore Congress to block the FCC from implementing regulation of ISP's. >> Although it's ideologically tepid support, the idea has, at the moment, >> considerable appeal to probably a large enough majority to make it >> veto-proof. Especially, if it is combined with a proposal to "reform" >> something and prevent yet another permanent subsidy of poor business >> practices. It would have widespread public support - including the >> TEA >> Party movement, and a huge array of think tanks, conservative activists >> groups, and industry lobbying groups outside of even our industry. >> >> So, should WISPA officially adopt the idea that direct and permanent >> subsidy >> be opposed, period, this can go forward, with support from probably every >> member and definitely gain widespread WISP support, since it is sensible >> and >> at the same time, defends our long term interests. >> >> 1. That USF funding in the form and concept in which it exists now >> never >> apply to ANY internet service. >> 2. That any "national broadband plan" never include any similar >> approach, >> which has proven to create long-term intractable monopolies built on >> inefficient business models and deep and permanent taxpayer subsidy. >> 3. That internet services be permanently left as private and >> unregulated >> businesses - except for those which exist by state, federal, or other >> franchise or legal establishment. For instance, no company with a >> "cable >> tv" franchise in a town could ever be eligible for any subsidy of any >> kind, >> in any place, ever. It's already a monopoly. It, too, would not be >> protected from regulation, as it concerns rates, net neutrality, etc. >> 4. No ILEC is ever eligible for any subsidy within the boundaries of >> it's >> incumbency, whether it is expanding broadband to unserved portions of its >> incumbency or not. Whether or not CLEC status should be included >> should >> be a subject of debate. >> 5. That any financial incentive consist solely as a refundable tax >> rebate >> per consumer serviced per month, with the consumers being defined as >> those >> who reside in an area currently without broadband, or in an area where >> infrastructure does not currently exist to serve at least 95% of all >> residences within that area. Area definition should be tied to local >> trade areas. Consumers would be defined as customers of the ISP, be it >> residential, business, or organization - like schools, businesses, or >> even >> other ISP's. >> 6. Rebate eligibility expires upon: 2 years after a 3rd provider or >> 2nd >> "different" technology covers at least 95% of all consumers within the >> defined areas. ( example, DSL access is limited to a smallish rural >> area, so the 1st and 2nd WISP can both claim rebates per consumer, but >> the >> DSL provider cannot unless it expands to reach 95% of the people. >> WISP's >> cannot qualify EITHER, unless or until they can cover 95%. Even if 2 >> WISP's fully cover, rebates continue until a third joins - then the >> trigger allows that WISP subsidy for 2 years,, or the telco rolls out >> universal DSL, at which the telco and WISP's continue for 2 years and >> then >> expires. Even if one/any/all go out of business after this threshold is >> crossed, the expiration is permanent,) >> 7. No ISP which opts out of eligibility or competes in any market >> without >> eligibility can have its services regulated. "net neutrality" and >> other >> such schemes can only apply to subsidized, uncompetitive markets. When >> the >> market is competitive by being served by at least 2 technologies and 3 >> providers, at near "universal" coverage, then no provider regulation is >> needed. >> 8. Middle mile providers who serve ISP's who qualify for incentive >> rebates >> are also eligible for rebate per consumer serviced by qualified ISP's who >> participate. Up to two middle mile providers per ISP can claim >> subsidy. >> Middle mile providers would be defined as non-ILEC providers of bandwidth >> who do not sell connections to residential or otherwise retail individual >> customers. "Net neutrality" and other regulation can apply to middle >> mile >> providers, too- if they claim any eligible rebates. >> 9. ISP's who build their own "middle mile" by moving data more than 30 >> statute miles (not path, but just distance) to get to a non-ILEC >> connection >> could also qualify for tax rebates, but would be required to provide >> minimal >> markup interconnection or bandwidth to other ISP's in the same trade >> area, >> subject to how much capacity exists vs use. (distance should be >> debated) >> 10. That ALL infrastructure investment be fully expensable -as in 100% >> write-off in year one, as it concerns taxes. Basically, that puts >> every >> ISP in the position of being able to write off and not be taxed on >> growing >> or expansion. This should be permanent tax policy for EVERYONE, >> everywhere. >> >> This conceptual idea is technology agnostic. It recognizes that >> UNIVERSAL >> coverage is really a phantom, because we do live in a country with >> totally >> isolated pockets of humanity. It recognizes that permanent subsidy is >> both unwise and unworkable. It encourages competitive behavior, >> rational >> business plans based on other than subsidized revenues. It preserves a >> very small level of subsidy for the truly isolated, even promotes >> competition within it. >> >> This idea recognizes and codifies that subsidy = threat of regulation and >> that free markets with a competitive environment do NOT need any >> regulation >> to provide workable services to consumers. >> >> This expires the vast amount of subsidy all by itself, with built in >> incentives to reach the point where it expires. >> >> It allows operators to opt out and be unregulated, even if they're in a >> qualified area, and their coverage has no impact on the subsidy >> qualifications. No pay, no pain. >> >> It gives Congress an additional incentive to permanently block the FCC's >> ideas, and yet at the same time, address specific concerns as it relates >> to >> net neutrality. >> >> I believe this idea to be sellable to a wide array of interests - both >> political and industry. It is sellable to the public - who is currently >> very mindful of where the government's money is being "blown". There >> is >> no incentive to game the system. Providers are not encouraged to get >> the >> money up front and provide mediocre services. There is no risk, it >> does >> not put public money at risk, it does not indebt providers. >> >> It provides incentive to build more middle mile, even competitive middle >> mile, with at least a couple of years of enhanced revenue to pay down the >> capital costs, maybe more. >> >> >> >> ++++++++++++++++++++++++++++++ >> Neofast, Inc, Making internet easy >> 541-969-8200 509-386-4589 >> ++++++++++++++++++++++++++++++ >> >> -------------------------------------------------- >> From: "Rick Harnish"<rharn...@wispa.org> >> Sent: Thursday, May 20, 2010 10:41 AM >> To:<memb...@wispa.org>;<motor...@afmug.com>; "'WISPA General List'" >> <wireless@wispa.org> >> Subject: [WISPA] How the FCC Proposes the Regulate Broadband >> >> >>> * FCC Proposes a THIRD WAY to Regulate Broadband >>> >>> * Appeal Comcast decision >>> >>> * Not likely to succeed as the vote was 3-0 in favor of Comcast >>> >>> * Go to Congress and get specific authority >>> >>> * Too long of a process >>> >>> * 1. Reinforce its ancillary authority argument >>> >>> * Suggested by the Court but not considered by the FCC because of >>> scope issues. >>> >>> * 2. Reclassify Internet communications as telecommunications service >>> to restore direct authority over Broadband communication networks >>> * 3. THIRD WAY - Move all Broadband Internet access service to Title >>> II and lightly regulate this service >>> >>> * Who is the Target? >>> >>> * Rural Carriers offer Broadband Internet access service as a Title II >>> telecommunications service (no effect) >>> * RBOC's, wireless, cable and Broadband over powerline providers offer >>> Broadband Internet access Service as Title 1. >>> >>> * These are the providers that will be subject to Title II regulations >>> * These entities can and will push back very hard >>> >>> * Purpose of the THIRD WAY >>> >>> * The Third Way isn't about Network Neutrality. >>> >>> * The proposed Title II regulation of Broadband Internet access >>> service does not regulate or control the entire transport to the >>> Internet >>> cloud >>> >>> * The Third Way IS about regulation of last mile Broadband for other >>> purposes. >>> >>> * "At the outset, it must be made absolutely clear that the issue of >>> reclassification goes far beyond our open Internet proceeding. It >>> involves >>> some of the most important parts of our National Broadband Plan - >>> universal >>> service, privacy, transparency, and cyber security. Without >>> reclassification, the road to achieving each of those issues is laden >>> with >>> land mines and likely to fail." Commissioner Mignon Clyburn - May 11, >>> 2010 >>> >>> * Propsed Regulations >>> >>> * Section 201 >>> >>> * Requires Internet providers to interconnect and charge reasonable >>> rates >>> >>> * Section 202 >>> >>> * Prevents price and service discrimination >>> >>> * Section 208 >>> >>> * Sets up FCC Complaint processes >>> >>> * Section 222 >>> >>> * Protects customer privacy and proprietary commercial information >>> >>> * Section 254 >>> >>> * Allows use of Universal Service Fund for Broadband >>> >>> * Section 255 >>> >>> * Ensures disability access >>> >>> * Problems with the Third Way >>> >>> * Major push back on this approach by the target providers (not Title >>> II presently) >>> * Problem achieving the goal of the reform - The Third Way doesn't >>> deliver Network Neutrality for example. >>> >>> * Effective regulation of Broadband has to include "customer-to-cloud" >>> transmission. This approach only addresses the last mile and ignores >>> the >>> middle mile transmission. >>> * Avoids regulation of any services provided over the transmission. >>> * Effort is initiated to ensure Net Neutral principles. However, the >>> management of the pipe does not need to be with the pipe provider, >>> instead >>> it can be with the ISP managing and controlling the middle mile to the >>> Internet >>> * The effort includes USF reform >>> >>> * Section 254 requires that USF be used for telecom service. If >>> Broadband isn't a telecom service, the whole notion of USF reform can't >>> happen easily under the NBP. >>> >>> * Next Steps for Title "I.V" >>> >>> * FCC will issue a Notice of Inquiry (NOI) on the matter. >>> * FCC has announced that it will move straight to a Declaratory Ruling >>> after the NOI. >>> * FCC has to create a record that allows the reversal of numerous >>> prior decisions. >>> * This will be a very complicated process >>> >>> >>> >>> >>> >>> Respectfully, >>> >>> >>> >>> Rick Harnish >>> >>> President >>> >>> WISPA >>> >>> 260-307-4000 cell >>> >>> 866-317-2851 WISPA Office >>> >>> Skype: rick.harnish. >>> >>> rharn...@wispa.org >>> >>> >>> >>> >>> >>> -------------------------------------------------------------------------------- >>> WISPA Wants You! 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