[Senate Hearing 117-705]
[From the U.S. Government Publishing Office]
S. Hrg. 117-705
RECENT FEDERAL ACTIONS TO EXPAND BROADBAND: ARE WE MAKING PROGRESS?
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HEARING
before the
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
__________
MARCH 17, 2021
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available online: http://www.govinfo.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
53-061 WASHINGTON : 2023
SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
MARIA CANTWELL, Washington, Chair
AMY KLOBUCHAR, Minnesota ROGER WICKER, Mississippi, Ranking
RICHARD BLUMENTHAL, Connecticut JOHN THUNE, South Dakota
BRIAN SCHATZ, Hawaii ROY BLUNT, Missouri
EDWARD MARKEY, Massachusetts TED CRUZ, Texas
GARY PETERS, Michigan DEB FISCHER, Nebraska
TAMMY BALDWIN, Wisconsin JERRY MORAN, Kansas
TAMMY DUCKWORTH, Illinois DAN SULLIVAN, Alaska
JON TESTER, Montana MARSHA BLACKBURN, Tennessee
KYRSTEN SINEMA, Arizona TODD YOUNG, Indiana
JACKY ROSEN, Nevada MIKE LEE, Utah
BEN RAY LUJAN, New Mexico RON JOHNSON, Wisconsin
JOHN HICKENLOOPER, Colorado SHELLEY MOORE CAPITO, West
RAPHAEL WARNOCK, Georgia Virginia
RICK SCOTT, Florida
CYNTHIA LUMMIS, Wyoming
David Strickland, Staff Director
Melissa Porter, Deputy Staff Director
George Greenwell, Policy Coordinator and Security Manager
John Keast, Republican Staff Director
Crystal Tully, Republican Deputy Staff Director
Steven Wall, General Counsel
C O N T E N T S
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Page
Hearing held on March 17, 2021................................... 1
Statement of Senator Cantwell.................................... 1
Statement of Senator Wicker...................................... 3
Statement of Senator Klobuchar................................... 40
Letter dated March 16, 2021 to Hon. Maria Cantwell and Hon.
Roger Wicker from Wade Henderson, Interim President and CEO
and LaShawn Warren, Executive Vice President for Government
Affairs, The Leadership Conference on Civil and Human
Rights..................................................... 42
Statement of Senator Thune....................................... 45
Statement of Senator Blumenthal.................................. 47
Statement of Senator Fischer..................................... 49
Statement of Senator Markey...................................... 51
Statement of Senator Sullivan.................................... 52
Statement of Senator Tester...................................... 54
Statement of Senator Cruz........................................ 56
Statement of Senator Sinema...................................... 58
Statement of Senator Moran....................................... 60
Statement of Senator Lujan....................................... 62
Statement of Senator Blackburn................................... 66
Statement of Senator Capito...................................... 68
Statement of Senator Young....................................... 70
Statement of Senator Lummis...................................... 71
Statement of Senator Rosen....................................... 75
Statement of Senator Lee......................................... 78
Witnesses
Christopher Ali, Ph.D., Associate Professor, Department of Media
Studies, University of Virginia; Knight News Innovation Fellow,
Tow Center for Digital Journalism, Columbia University......... 5
Prepared statement........................................... 6
Hon. Michael P. O'Rielly, Former Commissioner, Federal
Communications Commission...................................... 17
Prepared statement........................................... 18
Jon Wilkins, Partner, Quadra Partners............................ 21
Prepared statement........................................... 23
Justin Forde, Senior Director, Government Relations, Midcontinent
Communications................................................. 27
Prepared statement........................................... 29
Appendix
Letter dated March 17, 2021 to Hon. Maria Cantwell and Hon. Roger
Wicker from Jonathan Spalter, President and Chief Executive
Officer, USTelecom............................................. 81
Response to written questions submitted to Hon. Michael P.
O'Rielly by:
Hon. Roger Wicker............................................ 82
Hon. Shelley Moore Capito.................................... 82
Response to written question submitted to Justin Forde by:
Hon. Shelley Moore Capito.................................... 83
RECENT FEDERAL ACTIONS TO EXPAND BROADBAND: ARE WE MAKING PROGRESS?
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WEDNESDAY, MARCH 17, 2021
U.S. Senate,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Committee met, pursuant to notice, at 10:02 a.m., in
room SR-253, Anteroom: SR-254, Russell Senate Office Building,
Hon. Maria Cantwell, Chair of the Committee, presiding.
Present: Senators Cantwell [presiding], Klobuchar,
Blumenthal, Markey, Tester, Sinema, Rosen, Lujan, Wicker,
Thune, Cruz, Fischer, Moran, Sullivan, Blackburn, Young, Lee,
Capito, and Lummis.
OPENING STATEMENT OF HON. MARIA CANTWELL,
U.S. SENATOR FROM WASHINGTON
The Chair. Good morning. The Senate Commerce Transportation
Committee will come to order, and want to welcome our witnesses
to today's hearing about ``Recent Federal Actions to Expand
Broadband: Are We Making Progress?'' And we have a
distinguished list of witnesses today to help us discuss what
we have most recently done on a variety of broadband programs
and access and increasing services, and also, ideas and
frameworks for how we should move forward. So, we welcome the
witnesses today to be here.
The last year has been a very stark reminder about how
important broadband connectivity is to Americans. As we have
faced a pandemic, the Internet has become the place to go to
work, to attend school, to see friends, to help visit the
doctors, and do many of the day-to-day things that we have all
had to do in our lives. We have had to struggle throughout the
pandemic, but imagine what life would have been like if we did
not have the Internet during that time period. For millions of
Americans, they do not have to imagine, because some of them
really did not have access to the internet.
So, I know we are going to hear from our witnesses today,
like Dr. Ali, who is saying that the diagnosis and
understanding of our most recent spending, that still there is
37 percent of rural Americans who could be paying more for
Internet connectivity than their counterparts in urban areas.
That truly is unacceptable. We need our rural communities to be
on a level playing field. And as our other witnesses, Mr.
Forde, will be with us, I think virtually, will also point out
that what we do next has to be done right, otherwise, we could
be in a situation where those who are currently lacking service
could, after more spending, continue to lack service. We cannot
allow that reality to happen.
If we are going to make investments, which I think we
should, we need to make sure that we are really going to cut
the digital divide. The stories that I hear from my home state
in Washington are heartbreaking. A principal from the Columbia
School District, near Spokane, recently described the impact to
remote learning to her school, only to find that close to 70
percent of the students and their families lacked consistent
access to broadband internet. Even those who did have access
often lacked a strong enough signal for more than one of their
children to attend virtual class, putting the parents in an
impossible dilemma of who is going to go to school that day.
And that problem did not stop within the households,
either. Neighborhoods and multiple children trying to attend
their digital classrooms, the signal failed to hold up, leaving
them with many challenges. The principal's conclusion reads
like a wake-up call for those trying to make policy in this
space. ``The need for appropriate Internet and cellular
coverage in Stevens County,'' the principal said, ``is glaring
at us like a neon light.'' Well, I could not agree more that it
is glaring at us, and we need to get the next phase right.
Today, we are going to review some of the recent extensive
programs the FCC developed and implemented. The Rural Digital
Opportunity Fund and RDOF auction; Congress created the
ReConnect Broadband grant and loan program for rural counties;
the NTIA Administration is working on rules for Tribal and
rural grant programs from the December COVID package; and the
American Rescue Plan, just recently signed by President Biden,
a new Treasury program targeted infrastructure.
I am pretty sure all four witnesses will remind us today
that coordination, something that Senator Wicker has been
resolute about, and helped us get some initial language into
previous laws--that the lack of coordination between these
programs and Federal agencies also needs to be strengthened,
and I appreciate his previous legislation on that. So, I am
sure all the witnesses are going to tell us that better
coordination between these resources, also, is very important.
We will also here how the FCC predicted that it might take
as much as $80 billion to close the digital divide. And I know
that we are going to hear a lot of different inputs about that
this morning. My hope is that the Committee can develop a
strong bipartisan framework to look at this issue as we move
forward because, as our witnesses say, we cannot afford to
invest this money, and then, still have communities without
access moving forward. I hope that today we will hear from the
broad depth of experience that each of our witnesses have, and
they will talk about the necessary things before us, on getting
access to those underserved communities.
But I do think that affordability, resiliency, redundancy,
and security are also part of our agenda here. These are
important tools for an information age. This is how we live,
and work, and socialize, and educate the next generation, so I
hope we can get this right.
Thank you all for being with us today. And now, I will turn
to my colleague, Senator Wicker, for his opening statement.
STATEMENT OF HON. ROGER WICKER,
U.S. SENATOR FROM MISSISSIPPI
Senator Wicker. Thank you, Senator Cantwell. Thank you for
convening this important hearing and good morning to our
distinguished panelists. I look forward to your testimonies.
Last year brought challenges on a scale few could have
imagined. The COVID-19 crisis changed life dramatically for
almost every American. Many of our normal activities, such as
work, school, spending time with loved ones, moved online to
prevent further spread of the Coronavirus, including hearings
of this committee. This generated a significant increase in
broadband traffic and upended the average Internet usage
patterns. According to one estimate, broadband traffic
increased 51 percent last year.
The good news is that broadband networks in the United
States performed well, compared to other nations. Thanks in
part to a light touch regulatory framework that promotes
investment in broadband infrastructure, U.S. broadband networks
have been able to accommodate the sustained surge in online
traffic and bandwidth consumption during the pandemic.
For its part, the FCC, under the Trump Administration, also
took meaningful action to respond to the Nation's urgent
broadband needs. This included the launch of the Keep Americans
Connected Pledge, where providers voluntarily committed not to
terminate broadband services for any residential or small
business consumers because they were unable to pay their bills.
The FCC also adopted temporary modifications to existing
Universal Service Fund programs to support rising demand for
Internet services.
Along with these measures, the Commission completed the
Rural Digital Opportunity Fund (RDOF) Phase 1 Auction, which
awarded $9.2 billion to providers, including over $495 million
to providers in Mississippi, to deliver high-speed Internet
services to 5.2 million unserved homes and businesses across
the country. Today's hearing is an opportunity for witnesses to
discuss how the FCC and Congress can ensure that winning
bidders of the RDOF auction are in fact able to meet their
buildout obligations and deliver high-speed broadband services
as promised.
The bipartisan CARES Act, enacted last March, and the
bipartisan Consolidated Appropriations Act of 2021, enacted in
December, also provided billions of dollars in Federal
resources to broadband related programs. Together, these laws
directed over $400 million to the FCC to expand access to
telehealth services, $98 million to implement the Broadband
DATA Act to improve the Nation's broadband maps, $1.9 billion
to help small rural providers remove equipment from their
networks, that pose a national security threat, and $285
million to implement my Connecting Minority Communities Act,
which provides connectivity assistance to Historically Black
Colleges and Universities, and minority communities, through
the newly established Office of Minority Broadband Initiatives
at NTIA.
These bipartisan laws also provided billions of dollars to
the Department of Education in support of remote learning,
billions to the FCC to help low-income Americans remain
connected, hundreds of millions of dollars to the Department of
Agriculture to connect rural areas, and over a billion dollars
to NTIA to expand broadband to unserved areas and Tribal lands.
Each of these efforts marked a critical step toward connecting
all Americans and closing the digital divide.
Importantly, these bipartisan laws include meaningful
guardrails to ensure that broadband resources are spent
prudently and avoid the mistakes of past stimulus efforts that
ultimately led to significant waste, overbuilding, and millions
of Americans still left unconnected.
Of course, prudent spending starts with accurate broadband
maps. Next week will mark 1 year since the bipartisan Broadband
DATA Act was signed into law. The Broadband DATA Act directs
the FCC to collect more precise data about where broadband is
available and where it is not, and at what speeds. I am
disappointed that the FCC is now projecting that it will take
at least another year to comply fully with this law. I hope
witnesses will discuss how the delay in developing new maps
will impact the efficacy of existing broadband programs, as
well as those created through last year's COVID-19 stimulus, to
target resources to unserved areas and communities in need.
Coordination and information sharing among Federal agencies
responsible for administering broadband deployment programs are
also essential to expanding availability. My Broadband
Interagency Coordination Act was passed on a bipartisan basis
and signed into law as part of last year's COVID-19 stimulus
package. This will require the FCC, NTIA, and USDA to
coordinate the distribution of Federal funds for broadband
deployment, to prevent duplication and other mismanagement, and
I thank the Chair for acknowledging our mutual interest in this
subject matter.
I look forward to witnesses discussing how coordination
among these agencies can reduce overbuilding of existing public
and private broadband investments. I would also point out that
recently enacted legislation tasks the Treasury Department, the
FCC, states, and localities with administering billions in
broadband resources, without any safeguards to ensure proper
handling of funds. For example, there are no requirements that
the Treasury Department coordinate with the FCC or NTIA to
prevent subsidized overbuilding, duplication of broadband
benefits, and other wasteful spending. I am sure witnesses will
want to discuss how this might impact ongoing efforts to
provide universal broadband access.
Finally, as most of the broadband resources Congress
authorized over the past years remain unspent, I hope witnesses
will discuss how we can fund future broadband initiatives most
effectively, in order to address the remaining disparities in
access to quality and reliable communications services
throughout the United States.
So again, Madam Chair, a very important hearing with very
informed witnesses and I look forward to participating. Thank
you, ma'am.
The Chair. Thank you, Senator Wicker, and again, thank you
for your leadership on the coordination issue and many other
aspects of this debate and I, too, want to echo your concerns,
you know, regarding the mapping. I think everyone of, probably,
a hundred members of the U.S. Senate would do so. So, maybe
after today's hearing we will discuss what else we need to do
to get this information, because I have a feeling it is, pretty
much, really available. Let us figure out the ways to get it
sooner. I like your suggestion that time has passed.
OK, so now to the witnesses, and again, thank you all for
being here, both in-person and virtually, and we really look
forward to your testimonies, and we are going to start with
you, Dr. Ali.
STATEMENT OF CHRISTOPHER ALI, Ph.D., ASSOCIATE
PROFESSOR, DEPARTMENT OF MEDIA STUDIES, UNIVERSITY
OF VIRGINIA; KNIGHT NEWS INNOVATION FELLOW,
TOW CENTER FOR DIGITAL JOURNALISM,
COLUMBIA UNIVERSITY
Dr. Ali. Great. Chair Cantwell, Ranking Member Wicker,
distinguished members of the U.S. Senate Committee on Commerce,
Science, and Transportation, thank you for the invitation to be
here today to speak with you today, to speak about rural
broadband policy and deployment. It is a great honor to be
here.
Today, I will argue for a new national rural broadband
plan, one that incorporates what I called in my written
testimony, The 5 M's of Successful Rural Broadband Deployment:
Meaning, Money, Mapping, Municipalities, and Management.
I applaud you for passing the Consolidated Appropriations
Act which included $3.2 billion for the Emergency Broadband to
Benefit Program, and the American Rescue Plan Act, which
allocates $7.1 billion for broadband for schools and libraries,
and $10 billion for state infrastructure projects.
I am also excited about the reintroduction of the
Accessible, Affordable Internet for All Act last week. We need
to build on this momentum and develop a decisive and coherent
plan for rural broadband deployment.
Some quick facts about broadband deployment in rural
America. The FCC reports that 82.7 percent of rural Americans
have access to broadband at speeds of 25/3. Current research,
however, suggests that this number, the FCC has overestimated
connectivity by upwards of 50 percent because of faulty data
gathering methodology. Only 63 percent of rural Americans
report having an Internet connection at home, but that number
does not differentiate between technologies. For instance, 3
percent of farmers still use dial-up and far too many rural
Americans depend on DSL and satellite.
Rural Americans pay upward of 37 percent more for their
service than their urban counterparts, and that service is
often suboptimal. Only 30 percent of rural Americans have a
choice in provider, for speeds over 25/3. 25/3 is hopelessly
outdated as a baseline. It cannot meet the needs of
contemporary households and its asymmetry privileges download
over upload, consumption over production, which hurts students
and businesses alike.
Last, rural Americans are frustrated, frustrated with the
quality of their connectivity when they have it, and with the
lack of connectivity when they do not.
So, why is broadband availability in rural America such a
problem? Rural broadband is a market failure. Private providers
are unwilling, or unable, to provide basic service because of a
lack of sufficient return on investment. It is important to
note, however, that the same thing was said about electricity
in the 1920s and telephone in the 1930s. But ambitious,
forward-looking public policy solved these problems. Public
policy has yet to solve the problem of rural broadband.
I have heard it said that rural Americans do not need what
my friend Jonathan Sallet calls ``high performance broadband''.
That making this argument is trying to justify a Ferrari over a
Toyota Corolla--luxury versus utility. Nothing could be further
from the truth. We are not talking about a Ferrari and a Toyota
when we talk about fiber versus DSL. We are talking about
walking versus driving. High-performance broadband is not a
luxury. It is not gold-plated. It is not a Ferrari. High-
performance broadband is as essential today as electricity and
water.
We need a new plan for rural broadband, one that will raise
the definition to 100/100, so that rural Americans have
meaningful connectivity, not just good enough connectivity. We
need a plan that will allocate funding without privileging the
loudest and largest providers and will hold companies
accountable. It must fix mapping by relying on a combination of
granular audited data and crowd-sourced information and provide
a streamlined challenge process. A plan that recognizes the
crucial role of states, municipalities, local providers and
cooperatives, and celebrates local public investment. Last, a
plan that cuts through the policy gridlock of the FCC, RUS, and
NTIA by requiring meaningful and visible interagency
cooperation.
The FCC has estimated it will cost $80 billion to connect
the country with high-performance broadband. This is what we
must aim for. The exciting thing is, we have done this before
with the Rural Electrification Administration in 1935. To
connect the country with electricity, the REA championed the
creation of local electric cooperatives. It also sent
representatives on rural electrification tours, the REA Circus,
it was called, to encourage local adoption.
In a little over a decade, rural electrification soared
from 48 percent to 96 percent. It was so successful that REA
was tasked with rural telephony in 1949 and it went back to the
same model, trusting local communities and local cooperatives.
Today, hundreds of electric and telephone cooperatives, along
with small local and regional providers, are doing the vital
work of connecting their communities. It must be said, local
broadband is the best broadband.
Thank you for this opportunity to be part of this vital
conversation, and I look forward to taking your questions.
[The prepared statement of Dr. Ali follows:]
Prepared Statement of Christopher Ali, PhD, Associate Professor,
Department of Media Studies, University of Virginia; Knight News
Innovation Fellow, Tow Center for Digital Journalism, Columbia
University
Chair Cantwell, ranking member Wicker, distinguished members of the
United States Senate Committee on Commerce, Science and Transportation,
thank you for the invitation to speak with you today about policy
reform for broadband infrastructure deployment and investment in rural
America. It is a great honor to be here. My name is Dr. Christopher Ali
and I am an Associate Professor in the Department of Media Studies at
the University of Virginia, and Knight News Innovation Fellow at the
Tow Center for Digital Journalism at Columbia University. Previously, I
was the Faculty Research Fellow of the Benton Institute for Broadband &
Society and Academic Fellow with the Global Futures Council of the
World Economic Forum.\1\
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\1\ ``Christopher Ali,'' Department of Media Studies, 2021, https:/
/mediastudies.as.virginia.edu/people/profile/cfa2z.
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My testimony today is based on 5 years of research and writing
about rural broadband policy and deployment in the United States,
including in-depth policy analysis, field visits and interviews. This
research will be featured in my book Farm Fresh Broadband: The Politics
of Rural Connectivity that will be released in September from MIT
Press. Today, I want to share with you all what I'm calling the ``5
M's'' of successful rural broadband deployment: Meaning, Money,
Mapping, Municipalities, and Management. In doing so, I will also point
out some of the flaws in previous policy attempts to close the rural-
urban digital divide, and share my hope that history does not repeat
itself.
I am excited to speak about the potentials and possibilities for
policy reform to stimulate robust and meaningful broadband deployment
in rural America, which represents a facet of what is known as the
``digital divide.'' Other facets, as we know, include affordability,
access to device, and digital literacy skills, which together are part
of the larger concept of ``digital inclusion.'' \2\ Today though, I
will talk about broadband infrastructure, which is a part of the
digital divide specifically impacting rural America.
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\2\ NDIA, ``Definitions,'' National Digital Inclusion Alliance,
January 18, 2017, https://www
.digitalinclusion.org/definitions/.
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I applaud you for passing the Consolidated Appropriations Act in
December which allocated $7 billion for broadband access, including the
$3.2 billion Emergency Broadband Benefit Package \3\ and the recently
passed American Rescue Plan Act, which allocates $7.1 billion for
broadband for schools and libraries and $10 billion for state
infrastructure projects.\4\ We must now build on this momentum and
develop a decisive and coherent plan for ``high-performance broadband''
\5\ infrastructure investment.\6\
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\3\ ``The Consolidated Appropriations Act, 2021,'' Pub. L. No. 116-
260. H.R. 133 (2021), https://www.congress.gov/bill/116th-congress/
house-bill/133?q=%7B%22search%22%3A%22Consolida
ted+Appropriations+Act+2021%22%7D&s=4&r=12.
\4\ ``American Rescue Plan Act of 2021,'' Pub. L. No. 117-2. H.R.
1319 (2021), https://www.govtrack.us/congress/bills/117/hr1319.
\5\ Jonathan Sallet, ``Bringing High-Performance Broadband to Rural
America'' (Chicago, IL: Benton Institute for Broadband & Society,
2019), https://www.benton.org/blog/bringing-high-performance-broadband-
rural-america.
\6\ For example, the recently proposed Accessible, Affordable
Internet for All Act proposes a $94 billion investment in broadband
deployment and access. Tony Romm, ``House, Senate Democrats Unveil $94
Billion Bill to Close Digital Divide--The Washington Post,'' Washington
Post, March 11, 2021, https://www.washingtonpost.com/technology/2021/
03/11/house-senate-internet-broadband/.
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In 2017, Paul de Sa, Chief of the FCC's Office of Strategic
Planning and Policy Analysis authored a report estimating that it will
cost approximately $80 billion to connect the entire country with fiber
to the premise. This is what we should aim for: achieving universal,
high-performance broadband.\7\
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\7\ Paul de Sa, ``Improving the Nation's Digital Infrastructure''
(Washington, D.C.: Federal Communications Commission, 2017), https://
www.fcc.gov/document/improving-nations-digital-infrastructure.
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As we contemplate what policies are necessary to help this country
recover from the COVID-19 pandemic, broadband must be one of our top
priorities. We learned during the pandemic that access to high-
performance broadband is a matter of life and death for many Americans,
with a study from the National Bureau of Economic Research finding that
access to high-speed broadband is a major predictor of the likelihood
to social distance.\8\ Right now, those without broadband or those who
are under-connected, are struggling to make vaccine appointments, do
their homework, apply for benefits, look for work, or connect with
loved ones. Public policy has a role to play in making these
connections happen, but we must also ensure that the mistakes of the
past are not repeated.
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\8\ Lesley Chiou and Catherine Tucker, ``Social Distancing,
Internet Access and Inequality'' (Cambridge, Mass: National Bureau of
Economic Research, April 13, 2020), https://doi.org/10.3386/w26982.
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Rural broadband at a glace
Briefly, the FCC recently reported that 95.6 percent of Americans
have access to broadband at a speed of 25Mbps download 3 Mbps upload
(depicted as ``25/3''). This includes 98.8 percent of those in Urban
Areas, 82.7 percent of those in Rural Areas, and 79.1 percent of those
on Tribal Lands (see Table 1).\9\
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\9\ Federal Communications Commission, ``2021 Broadband Deployment
Report: In the Matter of Inquiry Concerning Deployment of Advanced
Telecommunications Capability to All Americans in a Reasonable and
Timely Fashion (GN Docket No. 20-269)'' (Washington, D.C.: Federal
Communications Commission, January 19, 2021), https://docs.fcc.gov/
public/attachments/FCC-21-18A1.pdf.
Source: Federal Communications Commission 2021, 2020 \10\
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\10\ Federal Communications Commission, ``2020 Broadband Deployment
Report: In the Matter of Inquiry Concerning Deployment of Advanced
Telecommunications Capability to All Americans in a Reasonable and
Timely Fashion (GN Docket 19-285)'' (Washington, D.C.: Federal
Communications Commission, 2020), https://docs.fcc.gov/public/
attachments/FCC-20-50A1.pdf; Federal Communications Commission, ``2021
Broadband Deployment Report: In the Matter of Inquiry Concerning
Deployment of Advanced Telecommunications Capability to All Americans
in a Reasonable and Timely Fashion (GN Docket No. 20-269).''
As we all know, the FCC's has grossly overestimated the number of
connected Americans because of faulty data gathering. Most researchers
suggest the FCC is off by upwards of 50 percent.\11\ So, we don't know
the exact number of un-and under-connected rural Americans, but there
are some things we do know.
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\11\ Sascha D. Meinrath, ``Broadband Availability and Access in
Rural Pennsylvania'' (The Center for Rural Pennsylvania, 2019), https:/
/www.rural.palegislature.us/broadband/Broadband
_Availability_and_Access_in_Rural_Pennsylvania_2019_Report.pdf; John
Busby and Julia Tanberk, ``FCC Underestimates Americans Unserved by
Broadband Internet by 50 percent'' (BroadbandNow, 2020), https://
broadbandnow.com/research/fcc-underestimates-unserved-by-50-percent;
Karl Bode, ``How Bad Maps Are Ruining American Broadband,'' The Verge,
September 24, 2018, https://www.theverge.com/2018/9/24/17882842/us-
internet-broadband-map-isp-fcc-wireless-competition.
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We know that only 63 percent of rural Americans report having a
broadband Internet connection at home but we don't know the types of
connections this may mean. For instance, 3 percent of farmers still use
dial-up according to recent assessments from USDA (see Table 2).\12\
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\12\ United States Department of Agriculture, ``Farm Computer Usage
and Ownership'' (Washington, D.C.: United States Department of
Agriculture, August 2019), https://downloads
.usda.library.cornell.edu/usda-esmis/files/h128nd689/8910k592p/
qz20t442b/fmpc0819.pdf.
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Source: USDA, 2019
We also know that rural Americans are frustrated with their
connectivity, when they have it. The predominate types of connection in
rural America are digital subscriber line (DSL) and satellite.\13\ DSL
is broadband provided through a twisted pair of copper wires, not
unlike traditional landline telephone service. Indeed, those companies
offering DSL are the legacy telephone companies like AT&T, CenturyLink,
and Frontier.\14\ While praised a decade ago for its then-high-speed
download capacity, DSL has proven not to be up to the task of serving a
country living, working, and studying from home. The mean download
speed of DSL, for instance, is 10 Mbps and the mean upload speed is 1
Mbps according to a study by Roberto Gallardo and Brian Whitacre (see
Table 3).\15\ 10/1 is far below the FCC definition of broadband of 25/
3, and even further below the national average of 179.06 Mbps download
and 64.89 Mbps upload.\16\ More to the point, a household of four, be
they a family or college housemates, could not be on different video
calls simultaneously. As a currently stay-at-home nation, we all
require access to what Jonathan Sallet of the Benton Institute calls
``high-performance broadband.'' \17\
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\13\ Roberto Gallardo and Brian Whitacre, ``A Look at Broadband
Access, Providers and Technology'' (Perdue University: Center for
Regional Development, 2019), https://pcrd.purdue.edu/files/media/008-A-
Look-at-Broadband-Access-Providers-and-Technology.pdf.
\14\ AT&T is actually phasing out its DSL product. Doug Dawson,
``AT&T Stops DSL Sales,'' POTs and PANs (blog), 2020, https://
potsandpansbyccg.com/2020/10/12/att-stops-dsl-sales/.
\15\ Gallardo and Whitacre, ``A Look at Broadband Access, Providers
and Technology.''
\16\ ``United States's Mobile and Broadband Internet Speeds,''
Speedtest Global Index, 2021, https://www.speedtest.net/global-index/
united-states.
\17\ Sallet, ``Bringing High-Performance Broadband to Rural
America''; Jonathan Sallet, ``Broadband for America's Future: A Vision
for the 2020s'' (Chicago, IL: Benton Institute for Broadband & Society,
2019), https://www.benton.org/publications/broadband-policy2020s.
---------------------------------------------------------------------------
Source: Gallardo and Whitacre, 2019
Rural Americans are also fed up with satellite internet, which the
FCC categorizes as a viable fixed broadband technology,\18\ but as
anyone who has spent time in rural America and tried sending an e-mail
over satellite Internet knows, satellite is nowhere near a complement
to fixed wireless, cable, or fiber. By ``satellite'' here I am
referring to geosynchronous satellite, such as that provided by ViaSat
or HughesNet, and not the low Earth orbital (LEO) satellite networks,
like Starlink, which has received so much press as of late.\19\
---------------------------------------------------------------------------
\18\ Federal Communications Commission, ``Measuring Fixed
Broadband--Tenth Report'' (Washington, D.C.: Federal Communications
Commission, January 4, 2021), https://www.fcc.gov/reports-research/
reports/measuring-broadband-america/measuring-fixed-broadband-tenth-
report.
\19\ Jon Brodkin, ``ISPs Step up Fight against SpaceX, Tell FCC
That Starlink Will Be Too Slow,'' Ars Technica, February 9, 2021,
https://arstechnica.com/tech-policy/2021/02/isps-step-up-fight-against-
spacex-tell-fcc-that-starlink-will-be-too-slow/; Jon Brodkin, ``SpaceX
Gets $886 Million from FCC to Subsidize Starlink in 35 States,'' Ars
Technica, December 7, 2020, https://arstechnica.com/tech-policy/2020/
12/spacex-gets-886-million-from-fcc-to-subsidize-starlink-in-35-
states/.
---------------------------------------------------------------------------
In addition to suboptimal technologies of connectivity, rural
Americans also pay more for broadband than their urban counterparts.
According to Broadbandnow.com a trusted site for broadband deployment
information, rural Americans pay upwards of 37 percent more for
broadband than those living in cities.\20\ 37 percent more, for
broadband technologies that cannot measure up.
---------------------------------------------------------------------------
\20\ BroadbandNow, ``Digital Divide: Broadband Pricing by State,
Zip Code, and Income 2019,'' Broadband Now, 2019, https://
broadbandnow.com/research/digital-divide-broadband-pricing-state-zip-
income-2019.
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A colleague and I just finished a study in Surry County, Virginia--
one of the least connected counties in the Commonwealth. We were
interested in learning about life in a broadband desert. We talked to
people who were spending hundreds of dollars a month for internet,
because they were forced to toggle between satellite, mobile phone, and
a mobile hotspot for connectivity. Still, many told us that despite
multiple devices and hundreds of dollars, they could not participate in
work calls over Zoom, stream Netflix or have their children participate
in remote learning. As one respondent said to us: ``I'm spending about
$400 a month . . . I can't stream anything. This is rural America is
what it is.'' Said another respondent in Surry County, ``we desperately
need the broadband.'' \21\ It is for reasons such as these why the Pew
Foundation found that nearly a quarter of rural Americans say broadband
access is a major problem.\22\
---------------------------------------------------------------------------
\21\ Nick Mathews and Christopher Ali, ``Desert Work: Life and
Labor in a News and Broadband Desert'' (Annual Conference of the
International Communications Association, Online: Unpublished, 2021).
\22\ Monica Anderson, ``For 24 percent of Rural Americans, High-
Speed Internet Is a Major Problem,'' FactTank: News in the Numbers
(blog), September 10, 2018, https://www.pewre
search.org/fact-tank/2018/09/10/about-a-quarter-of-rural-americans-say-
access-to-high-speed-internet-is-a-major-problem/.
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So, why is broadband availability in rural America such a problem?
In the language of economists, broadband is rural America is a ``market
failure''--the private providers are unwilling or unable to provide
service because of a lack of sufficient return on investment.\23\ There
are simply not enough potential customers and they live too far apart
to be served. Importantly, the same thing was said about electricity in
the 1920s and telephone in the 1930s, but decisive and ambitious public
policy solved those problems.\24\ Public policy has yet to solve the
problem of rural broadband.
---------------------------------------------------------------------------
\23\ F.M. Bator, ``The Anatomy of Market Failure,'' Quarterly
Journal of Economics 72, no. 3 (1958): 351-79; Christopher Ali, ``The
Politics of Good Enough: Rural Broadband and Policy Failure in the
United States,'' International Journal of Communication 14 (2020):
5982-6004.
\24\ Christopher Ali, Farm Fresh Broadband: The Politics of Rural
Connectivity (Cambridge, Mass: MIT Press, Forthcoming, 2021), https://
mitpress.mit.edu/books/farm-fresh-broadband.
---------------------------------------------------------------------------
I identify five reasons why public policy has struggled to bring
high-performance broadband to the majority of rural Americans, despite
a decade of attempts and billions of dollars spent annually.
Meaning
To begin, the FCC's definition of broadband is out of touch and out
of date. As a reminder, the FCC currently defines broadband at 25Mbps
download/3 Mbps upload.\25\ This definition was set back in 2015 and
has not been updated, despite a current national average of 179/64.\26\
---------------------------------------------------------------------------
\25\ Federal Communications Commission, ``2021 Broadband Deployment
Report: In the Matter of Inquiry Concerning Deployment of Advanced
Telecommunications Capability to All Americans in a Reasonable and
Timely Fashion (GN Docket No. 20-269).''
\26\ ``United States's Mobile and Broadband Internet Speeds.''
---------------------------------------------------------------------------
A particularly egregious component of this definition, is its
asymmetry. The current definition of broadband privilege download over
upload. Now, that may be great for binging Netflix but it is of no help
to the business community, telehealth, or remote learning.\27\ One of
the respondents for my book put it this way: ``Download is about
consumption, upload is about production.'' \28\ Said differently,
upload is about business and the business community is not served by a
national definition of 3 Mbps upload.\29\
---------------------------------------------------------------------------
\27\ Christopher Ali, ``The Presumption of the Connected,'' Benton
Digital Beat, 2020, https://www.benton.org/blog/presumption-connected;
Stuart Sweet, ``How Much Bandwidth Do You Need for Distance
Learning?,'' The Solid Signal Blog, September 13, 2020, https://
blog.solid
signal.com/tutorials/how-much-bandwidth-do-you-need-for-distance-
learning/.
\28\ Ali, Farm Fresh Broadband: The Politics of Rural Connectivity.
\29\ Doug Dawson, ``Upload Speeds,'' POTs and PANs, October 30,
2020, https://potsandpans
byccg.com/tag/upload-speeds/.
---------------------------------------------------------------------------
What the 25/3 definition has done, however, is allow the previously
mentioned dissatisfactory Internet access technologies--DSL and
satellite--to count as broadband and therefore qualify for the tens-of-
millions of dollars a year in grants and subsidies provided by the FCC
through the Universal Service Fund and the USDA through its loans and
grant programs. To the particular detriment of rural Americans, the 25/
3 definition has become a ceiling to which too many of the largest
providers aim to meet, rather than a floor to build upon.
I join many other researchers and lawmakers who argue that we need
an ambitious and forward-looking definition of broadband such as
100Mbps download/100 Mbps upload.\30\ One that compels providers to
abandon technologies like DSL and replace these wires with fiber or
fiber-backed fixed wireless if they want to continue to receive Federal
and state support. I look to the State of Minnesota for inspiration
here. Minnesota's Border-to-Border grant program funds technologies
that can reach and surpass 100/100.\31\ This allows the program to
remain technologically neutral and also champion forward-looking
deployment.
---------------------------------------------------------------------------
\30\ Sallet, ``Broadband for America's Future.''
\31\ ``Broadband Grant Program,'' Minnesota Department of
Employment and Economic Development, accessed March 14, 2021, https://
mn.gov/deed/programs-services/broadband/grant-program/.
---------------------------------------------------------------------------
Money
The second ``M'' of rural broadband policy is money. Between the
FCC's High-Cost/Connect America Fund and USDA's loan and grant
programs, roughly $6 billion annually is devoted to supporting rural
broadband deployment.\32\ This has been the case since 2015. Yet, the
rural-urban digital divide not only persists, but in many instances is
growing, as rural Americans are stuck with outdated technologies like
DSL and satellite, and urban Americans gain access to fiber. Why has
this happened?
---------------------------------------------------------------------------
\32\ Ali, Farm Fresh Broadband: The Politics of Rural Connectivity.
---------------------------------------------------------------------------
When the FCC's Universal Service Fund, High-Cost Program was
transitioned to the Connect America Fund (CAF) at the recommendation of
the National Broadband Plan \33\ funding was simply given to the 10
largest providers, known as ``price cap'' carriers, rather than
distributed through a competitive auction. Funding amounted to $1.5
billion a year for 6 years, with CenturyLink coming out as the largest
awardee, netting $505 million a year.\34\ In exchange for over $9
billion between 2015 and 2020, price cap providers only had to meet a
speed threshold of 10/1, not the national definition of 25/3.\35\ As a
result, CAF I and CAF II monies were spent on enhancing DSL rather than
deploying fiber.\36\ In comparison, 175 small providers, known as
``rate-of-return carriers'' received their own pot of funding through
the Alternate Connect America Model (A-CAM).\37\ These providers shared
$1 billion a year, had a minimum speed threshold of 25/3, and by many
reports are deploying fiber in rural areas at a faster pace than their
price cap carrier counterparts.\38\
---------------------------------------------------------------------------
\33\ Federal Communications Commission, ``Connecting America: The
National Broadband Plan'' (Washington, D.C.: Federal Communications
Commission, March 17, 2010), https://transition.fcc.gov/national-
broadband-plan/national-broadband-plan.pdf; Federal Communications
Commission, ``Report and Order and Further Notice of Proposed
Rulemaking: In the Matter of Connect America Fund'' (Washington, D.C.:
Federal Communications Commission, November 18, 2011), https://
www.fcc.gov/general/connect-america-fund-caf.
\34\ Federal Communications Commission, ``Connect America Fund
Phase II Funding by Carrier, State, and County,'' 2015, https://
www.fcc.gov/document/connect-america-fund-phase-ii-funding-carrier-
state-and-county.
\35\ Federal Communications Commission, ``Connect America Fund
Phase II FAQS,'' Federal Communications Commission, June 14, 2016,
https://www.fcc.gov/consumers/guides/connect-america-fund-phase-ii-
faqs.
\36\ Doug Dawson, ``Big Telcos and Rural Customers,'' POTs and
PANs, January 22, 2018, https://potsandpansbyccg.com/2018/01/22/big-
telcos-and-rural-customers/.
\37\ Federal Communications Commission, ``In the Matter of Connect
America Fund, ETC Annual Reports and Certifications, Developing a
Unified Intercarrier Compensation Regime (WC Docket No. 10-90; WC
Docket No. 14-58; CC Docket No. 01-92). Report and Order, Order and
Order on Reconsideration, and Further Notice of Proposed Rulemaking''
(Washington, D.C.: Federal Communications Commission, 2016), https://
www.fcc.gov/document/fcc-reforms-high-cost-program-rate-return-
carriers.
\38\ Federal Communications Commission; Doug Dawson, ``A-CAM--A
Subsidy That Works,'' POTs and PANs, January 31, 2018, https://
potsandpansbyccg.com/2018/01/31/a-cam-a-subsidy-that-works/.
---------------------------------------------------------------------------
As part of CAF II, price cap carriers were to meet various yearly
benchmarks, but there was no discernable accountability when they
failed to live up to their commitments. For instance, in 2019 both
CenturyLink and Frontier missed targets in 23 and 13 states
respectively.\39\ Nevertheless, they remained eligible for future
awards and the FCC even gave them, and all price cap carriers, an extra
year of funding.\40\
---------------------------------------------------------------------------
\39\ Jon Brodkin, ``CenturyLink, Frontier Took FCC Cash, Failed to
Deploy All Required Broadband,'' Ars Technica, January 23, 2020,
https://arstechnica.com/tech-policy/2020/01/centurylink-frontier-took-
fcc-cash-failed-to-deploy-all-required-broadband/.
\40\ Joan Engebretson, ``Carriers to Receive Seventh Year of CAF
Support, Worth $1.5 Billion for Rural Broadband,'' Telecompetitor,
November 17, 2020, https://www.telecompetitor.com/tag/connect-america-
fund/.
---------------------------------------------------------------------------
With funds left over from the CAF II program, a reverse auction was
held in 2018, and eligibility expanded.\41\ Funding amounted to $1.48
billion or $148 million a year for ten years. This time, fixed wireless
providers were the largest winners and a consortium of rural electric
cooperatives pledging gigabit speeds through fiber optics came in
third. ViaSat, a satellite provider, was the fourth largest recipient,
winning $122 million ($12 million a year) despite promising only
baseline speeds, and continuing to be plagued by issues of low speed
and high latency.\42\
---------------------------------------------------------------------------
\41\ Federal Communications Commission, ``Connect America Fund
Phase II Auction (Auction 903),'' Federal Communications Commission,
May 17, 2017, https://www.fcc.gov/auction/903.
\42\ Federal Communications Commission 2017.
---------------------------------------------------------------------------
The following year, when the FCC announced the creation of the
Rural Digital Opportunity Fund (RDOF) in 2019, pledging $20.4 billion
over ten years, spirits were high over the size of the fund.\43\
Critics, including myself, however, worried that history would repeat
itself.\44\ As we know, upon completion of the first phase, the FCC has
received harsh criticism. Specifically, the FCC was criticized for
awarding SpaceX, through its subsidiary Starlink, $885 million for its
LEO satellite network that has yet to be proven at scale.\45\ The FCC
also received criticism for failing to adequately vet applicants, with
some fixed wireless providers promising gigabit speeds when it is
debatable whether the technology is up to the challenge.\46\ This
criticism included a bipartisan-bicameral letter signed by 159 members
of Congress.\47\
---------------------------------------------------------------------------
\43\ Federal Communications Commission, ``In the Matter of the
Rural Digital Opportunity Fund (WC Docket No. 19-126) Report and
Order'' (Washington, D.C.: Federal Communications Commission, February
7, 2020), https://www.fcc.gov/ecfs/filing/02070806418528.
\44\ Christopher Ali, ``Thoughts on Rural Broadband Subsidies for
the New Decade,'' Benton Digital Beat, December 18, 2019, https://
www.benton.org/blog/thoughts-rural-broadband-subsidies-new-decade.
\45\ Brodkin, ``SpaceX Gets $886 Million from FCC to Subsidize
Starlink in 35 States''; Brodkin, ``ISPs Step up Fight against SpaceX,
Tell FCC That Starlink Will Be Too Slow''; Cartesian, ``Starlink RDOF
Assessment Final Report'' (Boston: Cartesian, 2021), https://
ecfsapi.fcc.gov/file/10208168836021/ FBA_LEO_RDOF_Assessment_Final_
Report_20210208.pdf.
\46\ Mike Dano, ``Some Big RDOF Winners Lean Away from Fixed
Wireless,'' Light Reading (blog), February 5, 2021, https://
www.lightreading.com/opticalip/some-big-rdof-winners-lean-away-from-
fixed-wireless/d/d-id/767204; Linda Hardesty, ``WISPA Claps Back at
Fixed-Wireless Critics in RDOF Dispute,'' FierceTelecom (blog),
February 23, 2021, https://www.fierce
telecom.com/telecom/wispa-claps-back-at-fixed-wireless-critics-rdof-
dispute.
\47\ James Clyburn et al., ``Letter to Ajit Pai,'' January 19,
2021, https://walberg.house.gov/sites/walberg.house.gov/files/
WalbergFCCRDOFletter.pdf.
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In summation, when it comes to money and funding, the FCC has all
too often favored the largest and the loudest providers, over the
hundreds of local, nimble, and dynamic providers, who combine fixed
wireless and fiber to the home to connect their communities.
Mapping
The third ``M'' in my rural broadband pentalogy is mapping. We have
all, no doubt, heard the substantial and frequent criticisms of the
FCC's broadband mapping methodology, but it is worth repeating
here.\48\ Mapping should be the first step in planning and funding of
broadband deployment, but as it stands today, we do not know who is
connected, unconnected, and under-connected. In fact, we have a better
map of the milky way galaxy then we do of who is un and under-connected
in rural America. As I noted above, research suggests the FCC has
exaggerated broadband deployment in the United States by upwards of 50
percent.\49\
---------------------------------------------------------------------------
\48\ Government Accountability Office, ``Broadband Internet: FCC's
Data Overstate Access on Tribal Lands'' (Washington, D.C.: Government
Accountability Office, 2018), https://www.gao
.gov/products/gao-18-630.Bode, ``How Bad Maps Are Ruining American
Broadband''; Karl Bode and Emanuel Maiberg, ``The FCC's New Broadband
Map Paints an Irresponsibly Inaccurate Picture of American Broadband,''
Motherboard, February 23, 2018, https://motherboard.vice.com/en_us/
article/8xdk8x/new-fcc-broadband-map; Eric Null, ``Why Can't the U.S.
Government Make a Decent Map of Broadband Access?,'' Slate Magazine,
March 28, 2018, https://slate.com/technology/2018/03/why-cant-the-u-s-
government-make-a-decent-map-of-broadband-access.html.
\49\ Meinrath, ``Broadband Availability and Access in Rural
Pennsylvania''; Busby and Tanberk, ``FCC Underestimates Americans
Unserved by Broadband Internet by 50 percent.''
---------------------------------------------------------------------------
The reason why we have found ourselves in such a state comes down
to what information providers are required to report to the FCC on Form
477.\50\ ISPs submit Form 477 twice a year and the information is used
to create the FCC's broadband maps and to determine which areas are
eligible for funding, such as for the RDOF program. Form 477 has three
structural flaws. The first is data granularity. ISPs have to report
connectivity at the census block level, not the address level. As a
result, a census block is considered ``served'' with broadband as long
as one edifice has broadband or the census block can be served by the
provider within 10 business days. ``This lack of granularity'' I wrote
in a recent peer-reviewed journal article, ``means the FCC has grossly
overestimated how much of the country--rural or urban--has access to
broadband.'' \51\
---------------------------------------------------------------------------
\50\ Federal Communications Commission, ``Fixed Broadband
Deployment Data from FCC Form 477,'' Federal Communications Commission,
2020, https://www.fcc.gov/general/broadband-deployment-data-fcc-form-
477.
\51\ Ali, ``The Politics of Good Enough,'' 2020, 5994.
---------------------------------------------------------------------------
The second flaw is data collection. The data is self-reported by
providers, with little in the way of auditing. Worse, ISPs only have to
report advertised speeds, rather than actual speeds, leading to an
exaggeration of which areas have meaningful connectivity. This is
particularly the case for providers using DSL and satellite networks,
``where there is considerable discrepancy between the theoretical speed
limit of a connection and the actual speeds received, based on factors
such as distance from the network node and the age of the network.''
\52\
---------------------------------------------------------------------------
\52\ Ali, 5995.
---------------------------------------------------------------------------
The third flaw returns us to the issue of meaning. The FCC treats
DSL, satellite, fixed wireless, cable, and fiber, as interchangeable
since they can all theoretically meet the 25/3 standard. But the
difference between the technologies and the user experience are myriad
and significant. Nevertheless, those connected on a rotting DSL network
because of industry neglect, and barely seeing 1 Mbps download, are
still considered ``served.'' \53\ As a result, not only do we not know
who is unconnected, we also do not know who is under-connected.
---------------------------------------------------------------------------
\53\ Doug Dawson, ``AT&T Stops DSL Sales,'' POTs and PANs, 2020,
https://potsandpans
byccg.com/2020/10/12/att-stops-dsl-sales/.
---------------------------------------------------------------------------
The implications for these bad maps are substantial. The most
important implication being that if a census block is considered
``served,'' it is ineligible for future funding from the FCC. While,
the FCC does not consider satellite in its calculation of eligible
areas for funding (because satellite covers 99 percent of the country),
hundreds of communities are living in broadband purgatory, un-and
under-connected in practice, but marked as ``served'' on the broadband
map. These communities have been described as being in ``digital
distress'' \54\ and ``stranded in the dial-up age.'' \55\
---------------------------------------------------------------------------
\54\ Roberto Gallardo and Cheyanne Geideman, ``Digital Distress:
What Is It and Who Does It Affect? Part 1.,'' Medium, February 19,
2019, https://medium.com/design-and-tech-co/digital-distress-what-is-
it-and-who-does-it-affect-part-1-e1214f3f209b.
\55\ Jennifer Levitz and Valerie Bauerlein, ``Rural America Is
Stranded in the Dial-Up Age,'' Wall Street Journal, June 15, 2017,
https://www.wsj.com/articles/rural-america-is-stranded-in-the-dial-up-
age-1497535841.
---------------------------------------------------------------------------
An example from my current research illustrates the gravity of the
situation. My research team at the University of Virginia is in the
midst of a study regarding Virginia county broadband plans, policies
and deployment. We asked counties to self-report their level of
connectivity. Our findings to this request echo those of previous
studies that found massive discrepancies between the FCC's report of
broadband deployment and the lived reality of rural Americans.\56\ To
use but one example, the FCC reports Bath County Virginia as being 100
percent served with broadband at speeds of 25/3. In addition the FCC
reports that 100 percent of the county has access to at least two
broadband providers. In comparison, Bath County reported to us in our
Virginia County Broadband Survey that only 10 percent of the county is
served with broadband at 25/3, and a full 90 percent is unserved. This
amounts to a 90 percent difference in the FCC reporting and county
reporting (see Figure 1).\57\
---------------------------------------------------------------------------
\56\ Meinrath, ``Broadband Availability and Access in Rural
Pennsylvania''; Busby and Tanberk, ``FCC Underestimates Americans
Unserved by Broadband Internet by 50 percent.''
\57\ Christopher Ali, Abby Simmerman, and Nicholas Lansing,
``Connected Commonwealth: The Role of Counties in Virginia Broadband
Deployment'' (Media and Democracy Lab, Charlottesville, 2021).
---------------------------------------------------------------------------
Source: Ali, Simmerman, & Lansing (2021)
Progress, however, has been made. I have been encouraged by the
incredible crowd-sourcing efforts conducted by Measurement Lab, and the
state-level mapping initiatives such as what is happening in
Georgia.\58\ Through the Georgia Broadband Deployment Initiative,
Georgia worked with Lightbox, a commercial real estate data company, to
create one of the most granular broadband deployment maps in the
country. The public has access to aggregate data at the census block
level, with the state has access to address-level data, demonstrating
that better maps are possible.
---------------------------------------------------------------------------
\58\ Shara Tibken, ``States Couldn't Afford to Wait for the FCC's
Broadband Maps to Improve. So They Didn't,'' CNET, February 23, 2021,
https://www.cnet.com/features/states-couldnt-afford-to-wait-for-the-
fccs-broadband-maps-to-improve-so-they-didnt/.
---------------------------------------------------------------------------
We desperately need to fix the maps and data collection
methodology, and I am glad to see that there is so much movement in
this space, from localities, to states, to the FCC's new Broadband Data
Task Force,\59\ and congress's actions in the Consolidated
Appropriations Act of 2021 to implement and fund the requirements of
the Broadband DATA Act.\60\
---------------------------------------------------------------------------
\59\ Federal Communications Commission, ``Rosenworcel Establishes
Broadband Data Task Force,'' Federal Communications Commission,
February 17, 2021, https://www.fcc.gov/document/rosenworcel-
establishes-broadband-data-task-force.
\60\ The Consolidated Appropriations Act, 2021.
---------------------------------------------------------------------------
Municipalities
The fourth ``M'' is municipalities. What I have learned in my
research and in my field visits across rural areas of the Midwest and
Virginia, is that local broadband is the best broadband. By this, I
mean that telephone and electric cooperatives and small local ISPs, are
the ones best serving rural communities. Cooperatives, for instance
understand that return on investment cannot be measured in quarters,
but in years and even decades. They are prepared to wait this long
because they also understand that they are making an investment in
their community. For municipalities, return on investment is measured
not in profits returned, but in people connected. Local provision also
means local accountability. There's a big difference when you can meet
the owner of your broadband provider in the grocery store or they
happen to be your neighbor than when the owner is based hundreds of
miles away in Dallas or Los Angeles.
``Municipalities'' in this instance, can also be expanded to
counties and states. Solving the rural broadband infrastructure gap
will require an all-hands-on-deck approach, where no stakeholder should
be left out or discounted. We know, for instance, that public funding
from municipalities, counties and states is essential for network
deployment, especially in rural areas. That 19 states currently
prohibit or inhibit municipal broadband investment means they are
forbidding municipalities from making an investment in the type of
future they envision for their community.\61\
---------------------------------------------------------------------------
\61\ Becky Chao and Claire Park, ``The Cost of Connectivity 2020''
(Washington, D.C.: Open Technology Institute, 2020), http://
newamerica.org/oti/reports/cost-connectivity-2020/; Baller Stokes &
Lide, ``State Restrictions on Community Broadband Services or Other
Public Communications Initiatives'' (Washington, D.C., 2019), https://
www.baller.com/wp-content/uploads/BallerStokesLideStateBarriers.pdf.
---------------------------------------------------------------------------
My favorite example of the power of local broadband, and an example
to which I devote an entire chapter of my book, is from Rock County,
Minnesota. Rock County is located in the southwest pocket on the state,
bordering South Dakota and Iowa. With the support of the county Board
of Supervisors in 2013, the County Administrator began to search for a
provider to connect the county with fiber-to-the-home. Eventually, that
provider partner was found in the form of Alliance Communications, a
telephone cooperative from South Dakota. With a $5 million grant from
the state of Minnesota, a county bond of $1 million, and the remainder
covered by Alliance, Rock County has become one of the most connected
counties in the state, with 99.93 percent availability for fiber to the
home.\62\ An incredible story and testament to the power of local
partnerships, local broadband, and state encouragement.
---------------------------------------------------------------------------
\62\ Alliance Communications, ``Rock County Fiber-to-the-Home
Project,'' https://mn.gov/deed/assets/rock-county_tcm1045-301887.pdf.
---------------------------------------------------------------------------
Management
The final ``M'' is that of management. And by management, I mean
policymaking at the Federal level. Today, we have three agencies that
share responsibility for broadband deployment and planning: the Federal
Communications Commission, the Rural Utilities Service of USDA, and the
National Telecommunications and Information Administration, or NTIA.
Each has an agenda and a mandate. Unfortunately, with so many chefs in
the kitchen, communities are being left out. Here's an example, 99
percent of borrowers from USDA's Telecommunications Loan Program also
receive funding from the Universal Service Fund.\63\ In fact, USF
funding is crucial because it may used as collateral to secure the USDA
loan. Any changes in USF policy, therefore, requires USDA input.
Despite a memorandum of agreement signed in 2014 between the USDA and
the FCC, there is little interagency cooperation.
---------------------------------------------------------------------------
\63\ Lennard Kruger, ``Broadband Loan and Grant Programs in the
USDA's Rural Utilities Service'' (Washington, D.C.: Congressional
Research Service, 2018), https://www.everycrsreport.com/files/
20181016_RL33816_76629ba2fb086f856e1d10a148ff0cf4aca53cbd.html.
---------------------------------------------------------------------------
Successful broadband policy management requires interagency
cooperation and coordination. It also requires an agency to lead. The
call for interagency cooperation is nothing new. The 2019 American
Broadband Initiative mentioned interagency coordination 45 times.\64\
In addition, the Consolidated Appropriations Act of 2021 included the
Broadband Interagency Coordination Act of 2020, which mandated
cooperation between the FCC, NTIA and USDA.\65\
---------------------------------------------------------------------------
\64\ Sonny Perdue and Wilbur Ross, ``American Broadband Initiative:
Milestones Report'' (Washington, D.C.: USDA, 2019), https://
www.ntia.doc.gov/files/ntia/publications/american_broad
band_initiative_milestones_report.pdf.
\65\ The Consolidated Appropriations Act, 2021, sec. 904.
---------------------------------------------------------------------------
Interagency cooperation is difficult to mandate and even harder to
assess. What is more difficult than coordination, however, is
determining which agency should be the coordinator.\66\ In 2017, for
instance, congress considered HR 800: The New Deal Rural Broadband Act,
which would have appointed USDA as the point agency for rural broadband
planning and policy.\67\ In 2018, it took up HR 3994 the Access
Broadband Act, which would have made NTIA the primary agency
responsible, \68\ this act was reintroduced in 2019.\69\ Also in 2019,
congress considered S.454: The Office of Rural Broadband Act, which
would have made the FCC the point agency.\70\ Three years, multiple
acts, multiple proposals for who should coordinate the country's
struggling rural broadband policies.
---------------------------------------------------------------------------
\66\ Christopher Ali, ``An Office of Rural Broadband: We've Heard
This Before,'' Benton Digital Beat, March 18, 2019, https://
www.benton.org/blog/office-rural-broadband-we%E2%80%99ve-heard.
\67\ Jared Huffman, ``New Deal Rural Broadband Act of 2017,'' HR
800 (2017), https://www.congress.gov/bill/115th-congress/house-bill/
800.
\68\ Paul Tonko, ``ACCESS BROADBAND Act,'' H.R. 3994 (2017),
https://www.congress.gov/bill/115th-congress/house-bill/
3994?q=%7B%22search%22%3A%22HR+3994+the+Access+Broad
band+Act%22%7D.
\69\ Paul Tonko, ``ACCESS BROADBAND Act,'' H.R. 1328 (2019),
https://www.congress.gov/bill/116th-congress/house-bill/
1328?q=%7B%22search%22%3A%5B%22%5C%22Access+Broad
band+Act%5C%22%22%5D%7D&s=7&r=1.
\70\ Kevin Cramer, ``S.454: Office of Rural Broadband Act,''
webpage, Congress.Gov, February 12, 2019, https://www.congress.gov/
bill/116th-congress/senate-bill/454/committees.
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A National Rural Broadband Plan
When articulated poorly, the 5 M's of rural broadband policy
replicate and extend what I have called in my writings ``the politics
of good enough.'' \71\ Said differently, our preference for rapidity
has made us blind to issues of speed, latency, price, and deployment.
The politics of good enough mean that anything is better than nothing
in rural America and that if you want something better, you should move
to the city. This logic has made us believe that 25/3 is good enough,
satellite and DSL are good enough, high prices and low service are good
enough. As I wrote elsewhere, ``'good enough' has become the enemy of
great high-performance broadband.'' \72\ I've heard it said that rural
Americans do not need high performance broadband. That making this
argument is trying to justify a Ferrari over a Toyota Corolla: luxury
versus utility.\73\ Nothing could be further from the truth. We are not
talking about a Ferrari and Toyota when we talk about fiber versus DSL,
we are talking about walking versus driving. High performance broadband
is not a luxury, it is not gold plated, it is not a Ferrari. High
performance broadband is as essential today as electricity and water.
---------------------------------------------------------------------------
\71\ Ali, ``The Politics of Good Enough,'' 2020.
\72\ Christopher Ali, ``The Politics of Good Enough,'' Benton
Digital Beat, November 12, 2020, https://www.benton.org/blog/politics-
good-enough.
\73\ Bronwyn Howell, ``The Rural Digital Opportunity Fund:
Subsidizing Toyotas or Ferraris?,'' AEIdeas, January 21, 2020, https://
www.aei.org/technology-and-innovation/the-rural-digital-opportunity-
fund-subsidizing-toyotas-or-ferraris/.
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We need a new plan for rural broadband.\74\ One that will raise the
definition of broadband so that rural Americans have meaningful
connectivity, not just ``good enough'' connectivity. A plan that will
allocate funding without privileging the largest providers and that
will hold companies to their promises with decisive sanctions. A plan
that will fix mapping by relying on a combination of granular audited
data and crowdsourced information and that provides a streamlined
challenge process. A plan that recognizes the crucial role of states,
municipalities, local providers and cooperatives, and celebrates local
public investment in networks in addition to public private
partnerships. And lastly, a plan that cuts through the regulatory
gridlock by requiring meaningful and visible interagency cooperation.
---------------------------------------------------------------------------
\74\ Christopher Ali, ``We Need a National Rural Broadband Plan,''
New York Times, February 11, 2019, https://www.nytimes.com/2019/02/06/
opinion/rural-broadband-fcc.html.
---------------------------------------------------------------------------
The exciting thing is, we've done this before. The Rural
Electrification Administration, created in 1935 and made permanent in
1936, had at its disposal $100 million dollars ($1.8 billion in today's
money) in its first year. It did not, however, spend the money on what
we could call ``big power.'' Instead, it championed the creation of
local electric cooperatives. It also sent its representatives on rural
electrification tours--the ``REA Circus'' it was called--to encourage
local adoption.\75\ This program was incredibly successful. It a little
over a decade, rural electrification soared from 48 percent to 96
percent.\76\ Rural electrification was successful in fact that REA was
tasked with connecting rural America with telephony in the 1940s and
1950s. Again, it went back to the same model, trusting local
communities and local telephone cooperatives. Today, the hundreds of
electric and telephone cooperatives that dot the country are the
``unsung heroes of broadband,'' \77\ connecting their communities with
state-of-the-art fiber optics and fixed wireless networks when the
largest providers had written these areas off as a bad investment.
---------------------------------------------------------------------------
\75\ Richard Pence, ed., The Next Greatest Thing: 50 Years of Rural
Electrification in America (Washington, D.C.: National Rural Electric
Cooperative Association, 1984).
\76\ Ronald R Kline, Consumers in the Country: Technology and
Social Change in Rural America, Revisiting Rural America (Baltimore:
Johns Hopkins University Press, 2000), 219.
\77\ Christopher Ali, ``Cooperatives: The Unsung Heroes of
Broadband,'' Benton Digital Beat, February 22, 2021, https://
www.benton.org/blog/cooperatives-unsung-heroes-broadband.
---------------------------------------------------------------------------
There is precedent for connecting rural and remote regions with the
necessities of modern life. Today, broadband is that necessity; it is
not an option, it is not a luxury. While we must make sure the mistakes
of the past are not duplicated, the history of connecting the
countryside is a history worth repeating.
Thank you.
The Chair. Thank you, Professor Ali. Again, thank you so
much for being here and for your insights, and that research.
We hope you will share the details of that with the Committee.
That is so helpful. Now, we will hear from the Honorable Mike
O'Rielly, former Commissioner of the FCC. Mr. O'Rielly,
welcome.
STATEMENT OF HON. MICHAEL P. O'RIELLY, FORMER COMMISSIONER,
FEDERAL COMMUNICATIONS COMMISSION
Mr. O'Rielly. Thank you. Chair Cantwell, Ranking Member
Wicker, and members of the Committee, Happy St. Patrick's Day!
Thank you for inviting me to share my views on the important
subject of expanding high-speed broadband access in America.
Thank you also for the Committee's indulgence last year,
considering my re-nomination to the FCC, which did not exactly
play out as expected, but I am very pleased to be here in this
new capacity.
For clarification, I do not currently represent any party
involved in the issues of this hearing. While that may make me
the worst consultant ever, the truth is my business is just a
handful of weeks old.
On topic, the availability of high-speed Internet allows
users around the world to communicate, learn, work, conduct
commerce, and so much more. And it has proven especially
important during the COVID-19 pandemic, when American families
have been isolated and quarantined.
America's private broadband sector deserves enormous credit
for the investment in upgrades it implemented, over the last
many years, to handle the recent increase in Internet traffic.
Our networks performed incredibly well, especially in contrast
to other nations. The technology has proven immensely valuable
for Americans with broadband access, and there should be little
doubt that progress has been made to extend its reach,
especially in bringing service to the most difficult corners of
our nation, through many FCC programs that I had a hand in
creating or reshaping. Simply put, the numbers of unserved
households have shrunk precipitously.
For those without access, however, much work remains, and
the Commission is working hard on this front, including
addressing the lack of accurate mapping, although the pace of
mapping improvements needs to be accelerated considerably.
Additionally, Congress recently has acted on many fronts to
improve broadband deployment via new FCC programs. And a host
of other Federal entities now administer broadband related
programs, initiated through the Congressional funding,
including the Department of Agriculture, NTIA, the Department
of Education, and the Department of Treasury.
On point, it should be universally accepted that subsidized
overbuilding Federal programs increase the likelihood of
duplicative investment, which, when it occurs, is extremely
counterproductive and harmful on many levels. While I do
believe coordination efforts in law will be of added value,
coordination can be difficult to mandate and practice, and can
mean a host of different things when multiple agencies are not
on the same page, when it comes to the problem that
coordination is supposed to solve. Congressional efforts on
this front may need to be much more expansive, in terms of
scope and demanded outcome, especially for agencies with a poor
track record, or none at all.
Like many, I am still analyzing the broadband related
provisions in the latest COVID-19 law, but several provisions
raise issues and concerns. Case in point, the new $10 billion
program created within the Treasury Department that can be used
for many purposes, including broadband facilities, appears to
have few, if any, limitations. That should raise a host of red
flags.
In terms of broadband funding in a larger infrastructure
bill, the draft efforts I have seen so far should raise
multiple concerns. I humbly suggest that the massive funding
levels, which will dwarf private sector and any current
government investment, should be pared back to, perhaps, no
larger than $20 billion or, if it is to remain at this level,
be done in tranches.
Beyond that, a number of troubling components should be
fully explored and potentially amended by the members of the
Committee, before any enactment. For instance, the asynchronous
speed thresholds suggested by some, do not reflect expected
usage of future growth, much less current levels. Ultimately,
it means a great deal of the country will be deemed unserved.
Funding will flow to the easier areas and the unserved areas
will be, essentially, ignored again.
Some of the policy cuts are also very problematic, like the
preemption of state municipal broadband limits. Moreover, I
have further concerns that recent Federal investment efforts
will undermine the Commission's efforts to promote efficient
subsidies.
Aside from the broadband funding issue, many restrictions
are preventing companies from deploying broadband to all those
without access, specifically, some state and local governments
and private company limitations, are acting as barriers to
greater deployment. Providers can face fees to utilize existing
communications infrastructure for poles, ducts, and conduits,
or convoluted processes to gain rights away and zoning
approvals. They also encounter limitations on the placement of
expansion of wireless facilities. The Committee should clarify
acceptable and prohibited practices and law, like was done in
the bipartisan 2012 Spectrum Act.
I also suggest, humbly, that you eliminate or revamp the
ETC designation process, which is hindering deployment.
In sum, broadband is a highly valuable service that can be
life changing for many Americans. Exceptional progress has been
made over the last few years, by the private sector and through
various Federal programs, to extend existing networks and
ensure service to those interested families. More work remains
to be done in this area, but it needs to be accomplished
through thoughtful and careful--thoughtfully and carefully,
lest it causes more harm than good.
I thank the Chair.
[The prepared statement of Mr. O'Rielly follows:]
Prepared Statement of Michael P. O'Rielly, Principal,
MPORielly Consulting, LLC, and Visiting Fellow, Hudson Institute
Thank you, Chairwoman Cantwell, Ranking Member Wicker, and Members
of the Committee, for inviting me to share my views on the important
subject of expanding high-speed broadband access in America. In a year
that has presented many challenges--on many levels--it is a pleasure
for me to return to familiar stomping grounds. May I also extend my
appreciation for your continued public service to our nation, despite
the unfair and inappropriate criticism often laid before this body.
Introduction
There should be little disagreement that broadband technology has
altered--and, in most cases, improved--American society. The
availability of high-speed Internet allows users around the world to
communicate, learn, work, conduct commerce, and so much more. These
benefits have never been more apparent than during the Covid-19
pandemic when American families have been isolated and quarantined. In
fact, in some instances, including access to telemedicine/telehealth or
testing and vaccine information, the technology has been a lifesaver.
America's private broadband sector deserves immense credit for the
investment and upgrades it implemented over the last many years to
handle the recent increase in Internet traffic. Reports and anecdotal
evidence suggest that companies experienced increases of 30 to 50
percent in usage compared to the pre-Covid time period. Our networks
performed incredibly well, especially in contrast to other nations,
including countries in the European Union, which were forced to request
that Internet content providers take measures to stymie Internet
consumption and speeds in order to minimize challenges to overall
network sustainability. It is because of our industry's foresight and
network advances in prior years that U.S. broadband networks were
generally able to sustain these capacity demands. And, the industry
should be duly credited for forgoing revenue and fees during the Covid-
19 crisis to ensure connectivity to subscribers in financial need, as
part of voluntary pledges to the government.
Despite these positive experiences, many American families still
have had to suffice with substandard broadband or are without the means
to obtain service. In addition, a portion of the population has never
sought to be connected at all. Addressing these issues was a high
priority during my time in public service, especially at the FCC, and
will remain so going forward.
Federal Broadband Investments and Challenges
One of the Commission's highest priorities over the last decade has
been to increase the availability of high-speed broadband. Without
availability or deployment, all other issues pertaining to broadband
access do not exist. While critics can and do argue over the speed
thresholds or measurements used, there should be no doubt that enormous
progress has been made, especially in reaching the hardest to serve
corners of our Nation. Most American families now have broadband or
will have the option to connect, thanks, in no small part, to the
efforts of the professionals at the Commission to distribute
approximately $4.5 billion annually in high-cost support from the
Universal Service Fund (USF). From modernizing the Connect America Fund
and removing obstacles to rate-of-return providers offering standalone
service, to the approval of model-based support and the introduction of
reverse auctions and the latest Rural Digital Opportunity Fund Phase I,
the FCC has been at the forefront of solving the broadband availability
problem. But more work remains, and I am not aware of a single person
who has ever suggested that the mission was or is near complete.
Instead, the private-public partnership that has proven productive will
need to continue to solve remaining connectivity gaps. And, governments
must continue providing the necessary incentives for the private sector
to continue to extend their networks and deploy new ones.
Congress recently has acted on multiple fronts to improve broadband
deployment. The added funding for broadband buildout to specific groups
or targeted populations in various legislative efforts has the
potential to serve important functions. Some of this money has been
allocated to the FCC to operate or expand specific programs. Congress
has also pushed for more precise broadband mapping, and deserves credit
for these efforts.
Moreover, a host of Federal entities, outside of the FCC, are now
administering broadband-related programs, including the Department of
Agriculture, the National Telecommunications and Information
Administration at the Department of Commerce, the Department of
Education, and the Department of Treasury. While I sincerely hope that
these programs will do immense good, I have concerns over how such
funding mechanisms have been administered in the past and worry about
their potential to undermine the Nation's progress in the future as
well.
Coordination, Duplication, and Overbuilding
Overlapping Federal programs increase the likelihood of duplicative
investment, which can be counterproductive to the efforts' success. I
certainly applaud Congress and the Committee, led by Senators Wicker
and Klobuchar, for promoting coordination efforts via the Broadband
Interagency Coordination Act as part of the 2021 Consolidated
Appropriations Act. While I do believe these provisions will be
helpful, coordination can be difficult to mandate in practice,
especially when the scope of relevant agencies keeps changing. Consider
that I held discussions years ago with the Department of Agriculture as
it was establishing the ``ReConnect'' broadband loan and grant program.
Sadly, its leadership had a weak grasp of what subsidized overbuilding
is and why it is problematic. Coordination can mean a host of different
things, and when two agencies aren't on the same page when it comes to
the problem that coordination is supposed to solve, measures to
coordinate agency actions may be ineffective. As a result, to avoid
impeding private sector broadband efforts and potentially threatening
the viability of smaller or mid-sized companies, Congressional efforts
to mandate to coordination may need to be more specific and robust.
Harm to FCC programs
I have additional concerns that recent Federal investments efforts
could undermine Commission efforts to promote efficient subsidies. By
distributing broadband subsidies through reverse auctions, for
instance, and enabling mechanisms like price discovery and competition,
the Commission reformed its programs to be more market-oriented and
effective. At the same time, the administration of Federal grant
programs by agencies with little broadband experience can undermine
this progress. Since FCC subsidy recipients face the risk that another
agency will subsidize a competitor, the value of their carefully
targeted support may be insufficient, and recipients may be left unable
to meet their obligations.
Obstacles to Buildout
Despite the great desire of policymakers, providers, and users to
ensure broadband access to those without, many restrictions are
preventing that from occurring. Specifically, some state and local
governments and private company limitations are acting as barriers to
greater deployment. Providers can face high fees to utilize existing
communications infrastructure--e.g., poles, ducts, conduits--or
convoluted processes to gain rights-of-way and zoning approvals. They
also encounter limitations on the placement or expansion of wireless
facilities. The Committee could advance deployment by clarifying
acceptable and prohibited practices. While I may be willing to push
these entities further than others, any clarifications in law would be
extremely helpful and preempt the constant legal squabbles.
Affordability and Adoption
It is a simple fact that deploying broadband networks and offering
services to consumers is an extremely costly and timely venture.
Unfortunately, as companies set the proper price points to recoup such
investments, the end consumer charges have proven to be more than some
American families can spend. The precise populations at risk for being
unable to afford broadband can be difficult to define, but we do know
that communities of color and those economically challenged are more
likely to be affected. There is also a certain portion of the
population that sees no value or need to obtain broadband. Improving
these situations are not a Republican or Democratic issue, but
represent real problems that need to be properly addressed.
For many years, I sought improvements to the Commission's Lifeline
program. My views were not always accepted, and I believe that the
program remains troubled. While a revised Lifeline could serve as the
basis of a new effort to address the affordability and adoption issues,
it is also possible that the recent Congressionally enacted Emergency
Broadband Benefit Program could be a more appropriate model.
Regardless, addressing these important concepts will require a more
holistic and thoughtful approach than has been attempted in the past.
New Investments and Possible Additional Efforts
Like many, I am still analyzing the broadband-related provisions in
the latest Covid-19 law, along with those just introduced to enact a
huge infusion of Federal broadband funding. My initial reaction is that
the added E-Rate funds will be difficult to stop once the pandemic
ends. This means that providers, who invested heavily in those areas,
potentially risk losing customers, which may affect their ability to
maintain, upgrade, and expand service. I also have concerns with the
new $10 billion program created within the Treasury Department. There
appears to be few, if any, limitations on how this funding can be used.
That raises a host of red flags, and I'm hopeful that appropriate
guardrails can be imposed later, with the recognition that they were
not permitted under the reconciliation process.
In terms of new legislative efforts as part of a larger
infrastructure bill, these efforts also raise concerns that hopefully
will be explored as part of the legislative process. If this proceeds
forward, there are a number of troubling components, beyond the funding
levels, that should be fully explored and potentially amended before
any enactment. For instance, the speed thresholds seem very ambitious
and could contradict the goal of connecting the truly unconnected, as
opposed to updating those areas with service.
* * *
Broadband is a highly-valuable service that can be life changing
for many Americans. Exceptional progress has been made over the last
few by the private sector and through various Federal programs to
extend existing networks and ensure service to those interested
families. More work remains to be done in this area, but it needs to be
accomplished thoughtfully and carefully, lest it causes more harm than
good.
The Chair. Thank you, Mr. O'Rielly, and thank you for
mentioning St. Patrick's Day. I am assuming, with a name like
O'Rielly, that maybe that is a relevant day for you. So, it is
for the Chair, myself, and for the Ranking Member. So, thank
you.
We are now going to turn to Mr. Wilkins. Thank you, Mr.
Wilkins for joining us virtually.
STATEMENT OF JON WILKINS, PARTNER, QUADRA PARTNERS
Mr. Wilkins. Good morning. Thank you, Chair Cantwell,
Ranking Member Wicker, and I look forward to my testimony
today.
Quick introduction, my name is Jon Wilkins. I am a co-
founder of a firm called Quadra Partners. We work extensively
in broadband. Prior to that, for 4 years, I was with the FCC,
where I headed up two of the large bureaus and offices there.
Most recently, for about the last year and a half, I actually
have been working with a large group of participants in the
RDOF process, and I will try to share some of the lessons
learned from that experience today.
Let me just start first with one number, $80 billion. Dr.
Ali mentioned it. In early 2017, the FCC released a staff
analysis that did try to answer the question, what is the
investment required to, once and for all, close the deployment
gap? And $80 billion was the answer. There has been progress
since then, but I think that a properly measured assessment of
the problem today will show that the gap has also been growing
and that we are still facing $80 billion problem, and so, that
is the right number to use.
The question then, of course, becomes if we are going to
make an $80 billion investment, do we have the right pieces in
place to spend it well today? And I think that answer is also
yes. With that said, I mean, just the RDOF process alone, I
think, sheds a couple important lessons. I will just quickly
touch on them, and then, certainly take any questions.
First and foremost, competitive award processes are
absolutely critical. Reverse auctions are an excellent way to
do it, and I will just say, the FCC is the leading agency, not
just in the U.S. Government but, frankly, around the world, at
running complex telecom auctions. I think there have been many
concerns raised about RDOF. I, frankly, share some of those. I
would be glad to take questions about it. But I just want to
emphasize, I think the problems with RDOF request, frankly,
design choices that were made by the Commission, with that
auction specifically, but that the mechanism itself is a good
one to use, going forward.
Second, I want to touch quickly on financing support,
capital formation, if you will. RDOF was $9.2 billion, but it
was paid out over 10 years, and for all but the largest
companies, that actually is not as helpful as it needs to be. A
broadband project requires massive initial investment. The
first 2 years of a project are almost all of the capital to
actually construct the network. Over time, it can have a pretty
good financial profile, but bringing that initial amount of
capital at the beginning is critical, and I will just say that
it is expensive. To lever up a funding stream like RDOF is
costly, and really what it means is that money that could be
going to broadband today, is going to banks and financial
intermediaries. And therefore, I think, specific proposals,
such as the Broadband Infrastructure Financing Innovation Act,
co-sponsored by Senators Lujan and Peters, very good idea. As
well, frankly, as proposals to have accelerated deployment, in
exchange for accelerated funding, such as the Accelerating
Broadband Connectivity Act, introduced last year by Senators
Wicker, Blackburn, and Capito.
I also want to touch briefly on affordability programs. We
tend to think about these in our policy world as, sort of,
separate silos. You know, E-rate over here, Lifeline over
there, I-cost over there. If you are building a broadband
project, those are all the same thing, which is total financial
support for my business case. Predictable affordability support
is actually very important to deployment, as well. Those
business cases, when the programs are synchronized, are
reinforcing. They all pull in the same direction, and they
should not be viewed in competition, frankly.
I do want to just briefly talk about the role of Federal
coordination, not just within the Federal agency level, but
with states and Tribal governments. The $80 billion investment
is actually just the sum total of the situation in each of the
states and Tribal areas. Each one is actually different. The
economics to complete deployment are different. The provider
base is different. State policy preferences are different, and
the states have a very big role to play. I think that last year
was a rough year for that kind of coordination. There were a
lot of different things going on. RDOF process was extremely
rapid. CARES Act introduced all kinds of new funding. It was
not a good year for coordination. Going forward, it is
important, if we are going to make substantial Federal
investments in the future, having states prepare now is very
important. And I think funding to support that has been a very
good idea, and there needs to be a lot of coordination with
states going forward, especially on mapping.
So, just in summary, $80 billion is a very good investment.
I actually wanted to thank Senator Klobuchar for introducing
the Accessible, Affordable Internet for All Act, along with a
lot of co-sponsors on the Committee. That is doing justice to
the size of the problem, and I do think, with implementation
that learned some of the lessons of the recent past, it will do
the job.
And I just wanted to finally say, these are investments.
One dollar of public support--public investment, is going to be
matched by 3, 4, 5 or more dollars of private investment. That
brings economic benefits and, of course, having high-
performance broadband in these rural areas brings economic
benefits above and beyond anything else that we can do to help
rural areas.
So, with that, thank you and I look forward to the
questions.
[The prepared statement of Mr. Wilkins follows:]
Prepared Statement of Jon Wilkins, Co-founder, Quadra Partners
Introduction
Thank you for the opportunity to testify today. My name is Jon
Wilkins, and I am a co-founder of Quadra Partners, an advisory firm
focused on the broadband sector. Prior to that, from 2013-2017 I served
as the Managing Director and then the Chief of the Wireless
Telecommunications Bureau at the Federal Communications Commission
(FCC). In those roles I was heavily involved in the Commission's work
to promote broadband and close the digital divide. Prior to serving
with the FCC, I was a management consultant for more than fifteen
years, working mostly with companies on different aspects of the
broadband market, dating back to the dawn of the broadband era at the
end of the 1990s. In short, for my entire professional career I have
been involved in the growth of broadband from both private and public
sector perspectives.
Of recent and specific relevance to the topic of today's hearing,
over the past eighteen months I worked with a multi-state group of
private and public entities to prepare for, and participate in, the
recent FCC Rural Digital Opportunity Fund (RDOF) reverse auction. I
will provide in my testimony today some of the lessons learned from
RDOF, both from the perspective of new types of providers seeking to
offer broadband as well as with respect to potential improvements to
funding award processes.
U.S. telecommunications policy has recognized the importance of
closing the digital divide for many years. Federal, state, and local
governments have pursued a range of policies to promote universal
access to broadband, and some progress has been made. Over the last
decade, the FCC's high-cost fund has invested approximately $40
billion, bringing broadband to millions of locations, primarily in
rural areas. Over the last five years, the FCC's E-Rate program has
successfully connected over 99 percent of U.S. schools to the high-
speed connections needed for modern digital learning. And over just the
last few months, Congress has provided new support for broadband
adoption and deployment that will help millions to afford broadband
service now and have access in the future.
Despite this progress, however, the need for high-quality broadband
is increasing and the demands on our broadband infrastructure are
growing at an astonishing rate. What was good broadband, or at least
good enough, just ten years ago is now evidently inadequate. And while
in large parts of the country--such as middle-and high-income
households in city and suburban neighborhoods--our private provider
market is largely meeting this need, for a significant portion of the
U.S. population the lack of access to affordable broadband
infrastructure has become an increasingly dire problem. The last year
of pandemic disruptions to work, school, commerce, and almost every
other aspect of life have highlighted the stakes in the starkest
possible terms.
What is very encouraging is the important shift now underway--as
evidenced by today's hearing--to address the digital divide not simply
as an issue of traditional telecom policy, but as a question of
infrastructure investment and national economic development. This is an
extremely important and welcome change, because both the national need
to solve the broadband problem once-and-for-all, as well as the
potential for successfully doing so, has never been higher. Each dollar
of public investment in broadband can generate several times that
amount in additional private investment, amplifying the economic
benefits. In the remainder of my testimony, I will highlight several
broadband-sector trends with policy implications and suggest some
considerations for how best to build on the policy actions and
investments of recent years.
Is $80 Billion Enough?
In January 2017, an FCC staff whitepaper calculated that a total
investment of $80 billion would be sufficient to reach the U.S.
residential and small-business locations then regarded by the
Commission as ``unserved'' by robust broadband infrastructure capable
of at least 25 Mbps downstream and 3 Mbps upstream (25/3 Mbps). The FCC
staff went on to estimate that approximately 85 percent of the
locations reached for this $80 billion investment would be self-
sustaining and require no ongoing subsidy; for the final 15 percent--
equivalent to about 2 percent of all U.S. locations--the FCC whitepaper
noted the need for an ongoing subsidy of approximately $2 billion per
year, or about half of current Commission annual support amounts. The
$80 billion investment and annual $2 billion support figures were
calculated using detailed economic information and modeling
capabilities available to the FCC's expert staff and were based on
reaching all such unserved locations with fiber-to-the-premise (FTTP)
connections.
Some progress has been made in the interim, including ongoing
deployments of projects funded by prior FCC awards, such as the 2018
Connect America Fund (CAF)-II auction, as well as ReConnect grants from
USDA and various state efforts. The recent RDOF auction will also
result in support for additional deployments after the FCC completes
its ongoing review of long-form applications. It is important to note,
however, that far from all CAF-II and RDOF awards were for the high-
quality fiber networks modeled in 2017.
However, despite this progress, as of March 2021, the total
investment required is likely still at least $80 billion, and more
likely somewhat higher. This may seem somewhat counterintuitive given
investments over the recent years, but I believe it to be the case for
the following reasons. First, the 2017 analysis used the FCC's best
maps of broadband deployment available at the time, which are known to
undercount the size of the unserved population. For example, as members
of this Committee are acutely aware, the FCC's legacy approach treats
all locations in a census block as served if a provider reports the
ability to provide service to just a single location in the block; this
alone leads to undercount by definition. In addition, location growth
in some rural areas over the last decade is of course not captured by
legacy FCC data. As a result of these basic data issues alone, when the
FCC completes its current work to update broadband availability maps
for the entire country as mandated by the 2020 Broadband DATA Act, it
is widely expected that nearly as many unserved residential and small-
business locations will be identified in the new total count as was the
case in 2017, even accounting for new deployments funded by private or
public investments in the intervening years. The persistence of this
gap is felt as a daily reality in communities across the country.
Second, end-user performance requirements have clearly increased
from the 25/3 Mbps level used for the FCC's 2017 analysis. Reliance on
video-intensive, two-way applications--then viewed mostly as the
province of niche gaming enthusiasts, now widely understood by most
Americans in the form of video-conferencing services--has skyrocketed
since 2017. Recent calls for higher minimum broadband performance
definitions such as 100/100 Mbps and legislative proposals urging
symmetrical upload and download speeds address this reality. Raising
the bar on what it means to be adequately ``served'' would mean that
some of the locations counted by the FCC in 2017 under the 25/3 Mbps
standard would not meet updated performance requirements, increasing
the magnitude of the problem.
The size of the accessibility gap is therefore likely at least as
large as it was assessed to be in 2017, and the $80 billion estimate
remains a good, if perhaps low, one to use for policies looking forward
to the rest of 2021 and beyond.
Policy Improvements To Get the Best Results from $80 Billion
Like any financial projection, the FCC's 2017 whitepaper
necessarily relies on certain assumptions in arriving at its $80
billion figure. For example, the analysis assumes that the award
process for such funds will be done efficiently, that is with dollars
awarded that match the true subsidy need. The analysis also assumes
that $80 billion will be available to awardees immediately, because a
broadband project requires a significant portion of the required
investment to be spent within the first two years. Finally, the
analysis assumes that the networks generate customer revenues for
service once they are built; in other words, the $80 billion figure is
not the standalone total investment required (that amount is
considerably higher), but rather reflects the difference between total
customer revenues and total project costs.
The good news is that existing policy mechanisms, as well as
certain proposed new policy actions, could provide a sound national
strategy for addressing all of these areas. However, I believe there
are also a number of improvements that could be made to significantly
enhance the likelihood that a public investment of at least $80 billion
would truly close the deployment gap.
Economically Efficient Allocation: Auctions Are Not Self-Executing
Any government support for broadband deployment should ultimately
flow to specific projects via a competitive award process. The policy
goal should be to reveal the true economic need (subsidy) for different
projects in a given area and then award the lowest possible subsidy
sufficient to meet the desired performance of the network. In concept,
some form of reverse auction is an excellent solution to the problem.
On the favorable side, what the RDOF-I (and earlier CAF-II) auction
demonstrated was that there is interest in providing rural broadband
from a wide range of entities, including traditional and
nontraditional, large and small, private and public, incumbents and new
entrants. More than four hundred bidding entities, representing an even
greater number of underlying operating companies, participated in the
RDOF-I auction, an astounding number. As one example, large numbers of
rural electric co-operatives demonstrated the increasing interest of
that industry in offering broadband to their members. Various other new
entrants also see opportunities to serve rural markets. This in and of
itself is a very positive and relatively new development, but it is not
surprising. Given the increasing economic importance of broadband,
these projects are of significant interest to local providers,
investors, and state and local governments. The RDOF-I outcome showed
that a subsidy boost is enough to persuade many types of providers to
pursue building new broadband networks to unserved communities.
However, a reverse auction is just a type of allocation mechanism;
the results of an auction are greatly affected by the specific auction-
design choices made. Unfortunately, a number of the design choices made
for the RDOF-I auction led directly to an outcome that has raised many
questions, and many members of this Committee have voiced direct
concerns. From a policy perspective, I would highlight three issues.
First, the RDOF-I auction made distinctions among bidders on just
two dimensions: network speed and latency. Though important, these are
far from the only attributes of broadband infrastructure that matter to
rural communities. Future auctions could consider factors such as more
symmetric performance, scalability, long-term durability, resiliency,
and reliability. For example, telecommunications industry veterans
remember that ``five-nines reliability''--99.999 percent availability,
meaning the network is down for less than six minutes per year--was the
gold standard for the last century's networks. While promoting
competition between different technologies is critical in many areas of
telecom policy, the question in a reverse auction for subsidies is not
``which technology is allowed to compete in the market?'' but rather
``what is the performance profile of a network deserving public
investment?''
Second, an auction must reveal, at least approximately, the true
economic needs of bidders. Simply put, some RDOF-I auction winners will
receive support for networks that, by their own public statements,
would have been deployed anyway. This is a fundamental flaw in auction
design that must be fixed in future award processes.
Third, an auction is fundamentally the result of competitive
bidding by the entities that are allowed to participate. Though it is
important not to set the table stakes for entry so high as to deter new
providers, many of the concerns about the RDOF-I auction results
indicate that more stringent requirements should be placed on aspiring
bidders in future auctions. As an example, requirements could include
more rigorous pre-auction demonstrations of actual ability to operate
at the promised quality of service in a given geography, or operating
experience with a given type of broadband network. States and
localities could also be engaged to provide input into the
qualifications of bidders seeking support in a given state.
Time Equals Money: The Capital Formation Problem
RDOF also provides a useful illustration of a critical policy
issue: the difference between upfront investment required versus the
duration of time over which support amounts are paid. While the largest
Federal programs such as RDOF win headlines for total award amounts
(such as $9.2 billion for RDOF-I), those amounts are in fact paid out
over ten years. This creates a ``capital formation problem'' for all
but the largest companies, and especially for new entrants to the
broadband market seeking to build larger projects.
Simply put, it can be costly for a ten-year funding stream such as
RDOF to be leveraged into the up-front capital needed for construction.
Just because I may receive $10 million per year for ten years (assuming
I don't run into any deployment problems), does not mean that an
investor or lender will give me anywhere near $100 million today. In a
reverse auction, these financing costs must be incorporated into
bidding strategies, potentially causing participants to drop out
earlier than otherwise necessary because a material portion of the
funds intended for broadband deployment must instead be spent on
financing. In other words, some projects will not be built despite
their inherent economic viability over the long term.
One initial improvement would be to shift to a shorter term for
paying out support that better aligns with actual project needs. A ten-
year period is too long. In reality, many cable and FTTP projects can
be built within two-to-three years, assuming adequate up-front planning
and preparation, such as ensuring access to needed materials and labor.
As one immediate upside, such a change would bring broadband to
unserved areas more quickly, an important benefit in and of itself;
indeed, many local stakeholders in rural areas strongly support
proposals to incentivize accelerated deployment. At the same time,
however, the government does have an important interest in maintaining
oversight and control of projects at least until a viable network is up
and running; handing over very large sums immediately is not good
policy.
Current proposals to add financing support in the form of loan
guarantees or other credit support mechanisms also could be very
valuable in addressing this capital formation problem. The core
question is one of project risk: How much will the public take on, and
how much must private investors be paid to carry? By taking on some of
the risk, government credit support could allow broadband projects to
be financed more like traditional long-lived infrastructure.
Cash Is Cash: Synchronizing Support for Access and Adoption
While the $80 billion analysis correctly assumes that currently
unserved residents have a strong demand for high-performance broadband,
in many communities even reasonable commercial rates for broadband
service may not be affordable for significant portions of the
population. In addition, unlike broadband networks in cities and towns,
rural networks typically have less opportunity to generate revenues
from businesses. The financial structure of broadband deployment--large
up-front capital costs but relatively moderate ongoing operating and
maintenance costs--means that the economic viability of a project can
be highly sensitive to adoption levels. Prospective providers must
closely analyze not just the cost to build the network, but also the
potential revenues. In some cases, uncertainty about the ability of
local customers to afford service over time deters the pursuit of
otherwise viable projects. This creates an unfortunate vicious circle,
with the communities most in need of the economic development benefits
of broadband least able to attract the needed investment.
Fortunately, longstanding broadband programs such as E-Rate and
Rural Health Care support for anchor institutions, as well as programs
designed for low-income users, including new programs such as the
Emergency Broadband Benefit, all are available to support the demand
side of broadband projects. Indeed, it is often overlooked that even
programs such as Lifeline could be important in both rural and urban
areas, and proposed efforts to strengthen Lifeline's support for
broadband data services would benefit communities across the country.
An additional area of improvement could be to better coordinate
these ``demand side'' programs with ``supply side'' programs such as
RDOF, the USDA's various programs, and other Federal deployment loans
and grants. As a simple example, the FCC, NTIA, and USDA could
implement streamlining initiatives to allow a grant recipient from one
deployment-support program to more easily be deemed eligible to
participate in existing, or new, demand-support programs.
Although in policy circles these programs are generally viewed as
distinct, to providers of broadband service and their investors, all of
these programs feed into a simple question: Are the risk-adjusted
expected customer revenues and government support enough to justify the
required investment? These programs therefore need not be viewed as
competing with each other, nor as serving separate constituencies.
Proper coordination combined with continued, sustainable funding would
allow the sum to be far larger than the individual parts.
The Need for Federal Partnership with States and Tribes
Federal support is vital, but states and Tribal governments also
have a critical role to play in closing the deployment gap. The overall
U.S. figure of $80 billion is of course simply the sum of the state and
Tribal needs. Critically, the specific types of projects and providers
best able to close the gap can vary significantly from state to state,
as can state policy preferences. State and Tribal broadband programs
can amplify and accelerate the impact of overall Federal efforts, and
recent steps to include a significant level of funding and discretion
in the American Rescue Plan for state broadband efforts are well
designed to meet this opportunity. States also have a major
contribution to make to the FCC's broadband mapping work. Many states
have been rapidly moving forward with their own mapping efforts and
they should be enabled to coordinate these efforts with the FCC's
mapping work and participate as partners in that process.
States and Tribes also have an important role to play in providing
early planning and advance preparations of locally tailored strategies
that will take greatest advantage of new Federal support. For example,
even before any additional action by Congress, the FCC has over $11
billion in Universal Service Fund support that can be awarded via the
RDOF II process. However, even with rapid progress on mapping, the
length of the required administrative process to finalize rules and
auction procedures likely means that the RDOF II auction will not start
until 2022, at the earliest. However, in advance of this states and
Tribes can make sure that providers in their jurisdictions are fully
informed about broadband mapping and community needs, are aware of
Federal funding opportunities and requirements, and are supported in
their bidding plans by reinforcing state policies. If Congress does opt
to provide additional broadband infrastructure investments, the impact
of early planning and preparations by states and Tribes will be even
higher.
It will be important going forward, however, that state, Tribal,
and Federal efforts do not work at cross-purposes. For example, the
FCC's unexpected and unfortunate decision late in the process to
preclude from RDOF-I any areas receiving state funding, including for
future deployment, caused significant uncertainty in many states, a
problem that persists given doubts about the viability of RDOF winners
in a number of states. Just as the various Federal agencies such as the
FCC, USDA, and NTIA should work to better coordinate on the standards,
timelines, and requirements for broadband funding awards, Federal
entities should place greater emphasis on federal/state/Tribal
coordination.
Spillover Effects, Including 5G
As the FCC's 2017 whitepaper addressed, the fundamental
justification for public investment in broadband infrastructure is that
high-quality broadband generates significant economic benefits not
fully captured by the operators of broadband networks themselves. The
widespread and growing reliance on broadband across sectors including
healthcare, education, and retail clearly illustrates this issue. A
final point in this context: the fiber networks deployed to serve
retail customers with FTTP in rural areas would directly support the
deployment of 5G mobile services as well. Just as fixed broadband has
now become essential to economic activity, true high-performance mobile
broadband--the essential promise of the 5G-deployment push now underway
by the Nation's mobile carriers--is becoming similarly essential.
Upcoming FCC efforts such as the $9 billion 5G Fund reverse auction
will be enhanced if participants know that essential fiber-based front-
haul and back-haul connections will be in available in rural areas.
Investment in fiber now will pay future dividends in the 5G arena as
well.
Conclusion
Broadband communications networks are the critical infrastructure
for today. Over the last ten years since the original National
Broadband Plan, the Federal government has put in place the policy
building blocks that, with some improvements and greater financial
support, could ensure access to high-performance, scalable, resilient
broadband to the many millions of Americans who lack it today. I
appreciate the opportunity to contribute to the Committee's
consideration of this important topic, and look forward to your
questions.
The Chair. Thank you, Mr. Wilkins. Thank you so much for
your testimony and, you are right. We are going to ask you an
RDOF question. We are going to ask the whole panel that. But
first, we are going to ask Mr. Forde--is it Forde? Forde?
Mr. Forde. Forde.
The Chair. Mr. Forde, thank you so much for joining us, and
we look forward to hearing your testimony, and I also thank you
for--I really want to learn more about what you are doing to
provide access to regional sporting events as part of your
business. We may not get to that in our hearing today, but I
will follow up with you later. But I think, to me, that is one
of the great aspects of having broadband in communities, you
can start providing content that other people may not be able
to access, but creates a broader community. So, thank you so
much for what you are doing. We look forward to your testimony.
STATEMENT OF JUSTIN FORDE,
SENIOR DIRECTOR, GOVERNMENT RELATIONS,
MIDCONTINENT COMMUNICATIONS
Mr. Forde. Chair Cantwell, thank you very much. Ranking
Member Wicker, members of the Committee, thank you for inviting
me here today to discuss Midco's experience with Federal
broadband funding programs. My name is Justin Forde, and I am
the Senior Director of Government Relations for Midco.
More than 440,000 residential and business customers count
on Midco services across five states: South Dakota, North
Dakota, Minnesota, Kansas, and Wisconsin. The majority of the
400 communities we serve are very rural. With most having
populations closer to 500, then 5,000.
We also serve thousands of acres, as you will see behind
me, of prime Red River Valley agricultural soil, where farms
are often miles apart. To be clear, what we do every day is
rural broadband.
The COVID-19 pandemic has put a spotlight on the importance
of broadband connectivity for all Americans. At Midco, our
private investment of over $457 million the last 5 years, has
positioned us to fully serve the needs of our customers, our
friends, and our neighbors as they integrated their lives from
work, school, and home. We connected 2,500 families to free
Internet in just a few short days in March. We partnered with
school districts to connect even more students and signed on to
former Federal Communications Commission Chair Pai's ``Keep
Americans Connected'' pledge.
The U.S. cable industry now offers 1 Gigabit service to 88
percent of American households, and over 95 percent of the
country has access to broadband service of at least 25/3. But
we need to solve the challenge of connecting those who do not
yet have Internet available, primarily in the most rural and
hard to reach areas. There have been significant improvements
to Federal broadband funding programs, but there remain
important ways to improve them further.
Our experience in Minnesota provides a powerful example of
what is going right with these programs. We have invested over
$44 million in 2020 alone, to connect more that 20,000 new
homes. But there are communities adjacent to these areas that
were not economical to serve. With the help of Minnesota's
Border-to-Border State Grant Program, we extended our network
to the areas surrounding those towns and continued to build out
Gigabit speed networks.
We have partnered with the FCC. With the help of a $38.9
million award, through the FCC's CAF II program, we will reach
more than 9,300 new locations. And with the help of a $4.96
million award, through the FCC's RDOF program, we will reach
6,500 previously unserved locations, with a wireline broadband
network capable of 5 Gbps speeds.
We are able to reach many of these rural communities
because we edge out our Internet from our fiber network in our
small rural towns to even more rural areas, as far as 50 miles
away, using fixed wireless technology. I can personally speak
to the benefits of fixed wireless. During the pandemic, my
three kids went to school online, my wife used the Internet to
run a small business, and I worked remotely for Midco, all via
fixed wireless.
Midco believes in the power of fixed wireless to bridge the
digital divide, so much so, that we recently spent $8.8 million
to acquire spectrum from the FCC's Citizens Broadband Service
Radio auction. We know that fixed wireless is a viable solution
for rural America.
This leads me to my first recommendation for broadband
support programs. It is critical, critical that they be
technology-neutral and encourage broad participation. When
providers can experiment with different ways of getting
broadband service to very hard-to-reach places, more Americans
get broadband service sooner.
Second, awards through competitive bidding. The auction
process determines what speeds can be most efficiently given.
Provided an area provides the flexibility, areas can also be
served with higher speeds, they will. In the recent RDOF
auction, over 85 percent of the locations will get gigabit-
speed broadband.
Third, stay focused, like a laser, on unserved areas. Both
the FCC and RUS have taken positive steps to direct new
broadband funding to where it is most needed. But these efforts
could be thwarted by proposals to redefine areas eligible for
funding. Recent suggestions that the definition of unserved
areas should be changed from areas lacking 25/3 service to 100/
100, will have serious consequences in rural America. Many
places that have high-speed broadband, including Gigabit
service, will suddenly become unserved areas that are eligible
for funding. Providers will seek to fund these areas, not
because they are easiest to build and serve. Funds will be
syphoned away from areas that do not yet have economic reach.
Those lacking broadband service today, will still lack
broadband service tomorrow, even after billions of dollars are
spent.
Fourth, continue to improve agency coordination to ensure
funds are spent wisely. We have been awarded CAF II funding to
reach areas of Dakota County in Minnesota and are fully on
track with our deployment schedule. But recently, we learned
that two other providers have been awarded CARES Act funding to
serve the same area. That is three providers awarded Federal
funds, to serve the exact same area. This is a very poor use of
Federal resource.
Fortunately, some progress is being made. The FCC is
implementing mapping requirements, the Broadband DATA Act, the
Access Broadband Act, and the Broadband Interagency
Coordination Act should help boost coordination efforts. But it
is critical that agencies distributing funding view this
coordination as an essential part of the award process, not an
afterthought when deploying funding.
Finally, we recommend continuing to remove barriers to
deployment. Obligations and costs placed on providers like us,
must be reasonable, lawful, competitively neutral, and not
unduly burdensome.
I commend this committee for its focus on ensuring that the
billions of dollars being spent on broadband benefit all
Americans, including those in rural America.
Thank you again for inviting me here today, and I look
forward to working with you on these important issues.
[The prepared statement of Mr. Forde follows:]
Prepared Statement of Justin Forde, Senior Director, Government
Relations, Midcontinent Communications
Chair Cantwell, Ranking Member Wicker, and Members of the
Committee, thank you for inviting me here to discuss Midco's experience
with Federal broadband funding programs. My name is Justin Forde, and I
am the Senior Director of Government Relations at Midcontinent
Communications (``Midco''). Midco is the leading provider of Internet
and connectivity, cable TV, phone, data center and advertising services
in the Upper Midwest. We also operate a regional sports network, Midco
Sports Network, which broadcasts live, local high school and regional
college sports.
More than 440,000 residential and business customers count on Midco
services across five states: South Dakota, North Dakota, Minnesota,
Kansas, and Wisconsin. Midco communities range from just over 100
people in places like Dodge, North Dakota, to our largest community,
Sioux Falls, South Dakota, which has a metro population of nearly
250,000. The majority of the 400 communities we serve are very rural.
Many have less than 50,000 people, with most having populations between
500 and 5,000.
The COVID-19 pandemic put a spotlight on the importance of
broadband connectivity for all Americans, and America's ISP networks
delivered. At Midco, our investment of over $457 million in the last
five years positioned us to serve the needs of our customers as they
fully integrated their work, school and home lives. We also connected
2,500 families to free Internet at home (including our rural, fixed
wireless network), partnered with school districts to connect students
needing service, and signed on to former Federal Communications
Commission (``FCC'') Chairman Pai's ``Keep Americans Connected''
pledge.
Collectively, ISPs have invested more than $1.8 trillion in capital
over the last twenty--three years to get America connected. Light-touch
regulatory policy from the FCC and Congress has enabled this work. The
U.S. cable industry now offers 1 Gigabit service to 88 percent of
American households, in both urban and rural communities. Currently,
over 95 percent of the country has access to broadband service that
offers speeds of at least 25 Mbps download and 3 Mbps upload. But we
need to solve the remaining broadband deployment challenge of
connecting those who do not have Internet available--primarily in the
most rural areas that are difficult to serve in a cost-effective
manner.
Midco provides Gigabit services to more than 95 percent of the
largely rural communities it serves. Many of our service areas are
adjacent to areas that are not economical to serve without Federal
assistance, and we have sought and obtained funding through Federal and
state programs to assist with expanding to those areas.
I'm here today to share our experience with those programs,
including those administered by the FCC--we participated in the FCC's
Connect America Fund (``CAF'') auction and the Rural Digital
Opportunity Fund (``RDOF'') auction--as well as the Department of
Agriculture's Rural Utilities Service (``RUS''). I will say that there
have been significant improvements to Federal broadband funding
programs since I last appeared before this Committee in 2019, but there
remain important ways to improve them further. With many billions of
Federal funding dollars being focused on broadband expansion, it is
more important than ever to get these programs right.
Midco's History of Innovation
Before discussing Midco's experience with funding programs, I want
to explain how we have innovated to provide broadband to rural
communities in various ways. Innovation and foresight have shaped
Midco's course for more than 90 years. We have made it our mission to
ensure that our most rural communities are at the leading edge of
technology. Across our footprint, our goal is always to continue to
find ways to meet and exceed the communications needs of our customers.
Founded in 1931, Midco began by operating movie theatres, and then
entered the radio business. In 1954, our owners launched the first
television station in South Dakota. From there, Midco evolved its
service line to include cable television and phone service. On April
15, 1996, in Aberdeen, South Dakota, a town of about 25,000 people
then, Midco launched our broadband Internet service.
Our commitment to innovation continues to motivate our business
initiatives. We own and operate four data centers in North Dakota and
South Dakota to give local businesses a cost-effective way to secure
their critical data and IT infrastructure. We provide solutions for
regional and national banking, healthcare, energy, and government
customers, among many other industries. We combine our data center
services with powerful network solutions through our wholly owned,
operated and engineered Midco fiber network. Our data centers are
directly connected to our fiber backbone, giving businesses access to
some of the fastest Internet speeds in the country.
Midco's willingness to evolve stems from our desire to serve the
communities where we live, work and educate the next generation. In
2017, we launched the Midco Gig Initiative--a commitment to bring
Gigabit Internet speeds to our entire service area--from the region's
smallest towns to its largest cities. In 2019, Midco Gig was available
to more than 90 percent of our customers. That year, we announced our
involvement in the 10G initiative, a commitment to invest $500 million
over 10 years on a global cable industry standard that will provide
ultra-fast multigigabit speeds in both directions, combined with low
latency, unmatched reliability, and rock-solid security for a broad
range of customers. Today, more than 95 percent of Midco's customers
across our footprint are receiving service that exceeds 1 Gig speeds.
In the coming months, we will announce a major upgrade that will give
even more customers greater speeds.
Our growth has included progress in reaching previously unserved
areas, thanks in part to our partnership with the FCC through its CAF
II and RDOF auctions and our partnership with the state of Minnesota
and its Border-to-Border Program. Our experience in Minnesota provides
a powerful example of what is going right with these programs and how
well-designed programs can help companies like Midco expand their
networks to new homes, including those that were previously unserved
and difficult to reach.
Midco invested $44 million in private capital in Minnesota in 2020
and connected more than 20,000 new homes, including 7,500 homes in new
markets. But there were communities in adjacent areas that were not
economical to serve. With the help of Minnesota's Border-to-Border
State Grant Program, Midco extended its network to some of those areas.
For example, in Scandia, Minnesota, a town of approximately 4,100
people, we built a Gigabit wired network that will improve access for
the residents of Scandia for critical e-learning applications and
health care resources, enable telecommuting options for residents, and
make businesses and city institutions more efficient.
We have also partnered with the FCC to expand to other previously
unserved areas in North Dakota, South Dakota and Minnesota. With the
help of an award of $38.9 million through the FCC's CAF II program, we
are edging out our network to reach more than 9,300 new locations with
100/20 speeds to serve previously unserved remote, rural areas. And
with the help of RDOF, through which we were awarded $4.96 million in
2020 to deploy broadband, we will reach 6,506 previously unserved
locations across North Dakota, South Dakota and Minnesota with a
wireline broadband network that will initially support a 1,000/500
speeds offer, but is capable of 5 Gbps/5 Gbps speeds. The maps below
show our planned 2021 expansion in Minnesota and South Dakota using a
combination of wireline and fixed wireless service.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Midco's Innovative Approach To Getting Broadband To Remote Areas
We have been able to reach many rural communities with broadband by
leveraging our extensive fiber backbone through our Midco Edge Out
strategy. We ``edge out'' our high-speed Internet from our fiber
backbone in urban areas to rural areas using fixed wireless technology.
We use the initial fixed wireless expansion from our wired plant to
meet consumers' immediate needs, and then leverage that expansion to
justify a wired network buildout in the future. While some rural areas
may support a wired build, other, more remote rural areas will continue
to be served with a fixed wireless solution.
For example, the Midco Edge Out strategy brought high-speed fixed
wireless to the rural, ``bedroom'' communities surrounding Grand Forks,
ND. The strong customer base and increased demand for broadband then
allowed Midco to build out such communities with a wired, Gigabit
network. We will then repurpose the fixed wireless equipment to serve
other rural communities.
I can personally speak to the benefits of the fixed wireless
approach, as I am a Midco fixed wireless customer. I have been a fixed
wireless customer for more than 10 years and Midco recently updated my
service to our LTE, 5G-ready platform. I get my Internet from the top
of a commercial tower in Grandin, North Dakota to my small farmstead
six miles west of Argusville. During the pandemic, my three kids went
to school online, my wife used the Internet to run a small business,
and I worked for Midco remotely. Midco's fixed wireless allowed us to
continue educating our children and working during the pandemic.
My neighbors are also Midco fixed wireless customers. One of my
neighbors runs a cattle ranch. He uses our fixed wireless to sell his
livestock by auction where speed and capacity matter, and where many
individuals are participating in the auction at the same time. He is a
happy Midco fixed wireless customer running a vital and thriving
ranching business in rural North Dakota.
Midco believes in the power of fixed wireless to bridge the digital
divide and enable our Midco Edge Out strategy so much that we spent
$8.8 million to acquire spectrum in the FCC's Citizens Broadband Radio
Service auction in 2020. This spectrum not only allows us to offer
speeds of more than 100/20 Mbps at distances up to eight miles from the
vertical asset, but it also gives us access to crucial mid-band
spectrum to continue innovating.
We know that fixed wireless technology is a viable solution for
rural America. We know that we can reach remote, rural areas that are
up to 50 miles away from our fiber network. We can also implement this
solution relatively quickly and without the effort or expense of
constructing fiber networks. Fixed wireless technology can also be
deployed during the winter months, when harsh weather makes fiber
construction impossible. This leads me to my first recommendation for
Federal broadband support programs: it is critical that the programs be
technology-neutral, encourage the broadest participation of qualified
broadband providers, and be as flexible as possible.
If broadband support programs are flexible, allowing providers to
experiment and innovate with different ways of getting broadband
service to hard-to-reach places, more Americans will get broadband
service. It is not possible or practical to build a fiber network to
every location in the country. Some are too difficult to reach, because
they are geographically remote, and others are very hard to serve
because of their topography--such as granite cliffs and protected
national forests. People in those areas should not be constantly passed
over for the opportunity to get broadband service because their area
cannot support the kind of build that most Federal funding programs
require. Setting high speed thresholds that can only be delivered by a
fiber network build may sound helpful, but in practice will continue to
leave many behind.
In addition to keeping an open mind on how companies deliver
broadband, based on our experience with the ReConnect program and
participating in the CAF and RDOF auctions, we would like to offer a
few other recommendations to ensure that future funding is used
efficiently and effectively to expand the reach of broadband networks
in rural America.
Our second recommendation is to award funds through open
competitive bidding. Using a ``reverse auction'' competitive bidding
process, as the FCC has done with its CAF II and RDOF programs, will
connect the most unserved homes, for the least per-home subsidy, at the
highest speed possible in the area--given all of the variables. This
gives the country the best bang for the buck. Letting the auction
process determine what speed can be most efficiently provided in a
given area--as the FCC did in the recent RDOF auction--also provides
the necessary flexibility I mentioned while ensuring that areas that
can be served at higher speeds will be. In the recent RDOF auction,
which resulted in highly competitive bidding, more than 99 percent of
funded locations will be receiving broadband with speeds of at least
100/20 Mbps, with an overwhelming majority (over 85 percent) getting
gigabit-speed broadband.
Our third recommendation is to stay focused on unserved areas.
Broadband programs should target funding to truly unserved areas, where
private investment is not going to occur without government assistance
but consumers need to be connected. In the past, some government
broadband programs have allowed funding to be used in places that
already have broadband service. Midco was overbuilt with our own tax
dollars in Mitchell and Yankton, South Dakota. In Yankton, government
dollars were used by a fiber company to overbuild two existing
providers; and the new provider used those government funds to ``cherry
pick'' a few business customers. We believe that scarce government
resources should be targeted to those who will build out to consumers
who do not yet have access to all the benefits broadband provides, for
jobs, education and health care services.
Fortunately, both the FCC and RUS took steps aimed at directing new
broadband funding where it is truly needed. The FCC requires areas
receiving new funding to be unserved and the ReConnect program requires
that areas are only eligible if at least 90 percent of households are
unserved. These steps were meant to guard against using government
subsidies to overbuild private investment or broadband deployment
funded through other Federal or state government programs, ensuring
that any such programs will make meaningful headway in closing the
Digital Divide.
These efforts could be thwarted by proposals to redefine what it
means to have broadband service available. When eligibility is
restricted to areas that do not receive a basic level of broadband
service, such as 25/3, we know that funding will be used to bring
broadband where it did not previously exist. But when areas are defined
as eligible for funding unless they have a higher level of service--
such as recent proposals suggesting an increase to 100/100--this means
that many areas where we and others have invested heavily, including
through public/private partnership programs, are suddenly considered
``unserved.''
Providers will naturally apply for funding to serve these newly
eligible areas, because those are the places that are easiest to build
and serve. This would mean that areas that already have robust
broadband service would be newly eligible for funding to build even
faster service, increasing the likelihood that funds would be siphoned
away from areas that are not economical to reach, and have struggled
for years to attract broadband deployment. The likely result would be
that those lacking broadband service today will still lack broadband
service tomorrow, even after billions of dollars in funding are spent.
We believe these proposals should be reconsidered.
Our fourth recommendation is to continue to improve agency
coordination and enact guardrails to ensure funds are wisely spent.
With several Federal agencies and a growing number of states dedicating
funding to broadband deployment, it is increasingly important to ensure
that all relevant agencies and to the extent possible, state programs
that are awarding grants for buildout, are coordinating with each
other. Close coordination is necessary to ensure that government
support is being used to help solve the problem of the unserved and to
help achieve the goal of universal connectivity. It is important that
the FCC keep its broadband deployment map updated, including showing
where and to whom funding has been awarded even if facilities are not
yet constructed. Regularly sharing that map with all Federal and state
agencies awarding broadband funding, so that everyone is working off a
common data set in determining which areas are unserved, is also
crucial.
As one example, we have been awarded CAF II funding to reach areas
of Dakota County, Minnesota. We have not yet started construction, but
are fully on track with the deployment schedule established in that
auction. Despite the fact that we have an enforceable commitment to
build a network in that area, and the census blocks we have agreed to
serve are easily available through the FCC's website, we recently
learned that two other providers have been awarded CARES Act funding to
serve that same area. Further, because the CARES Act funding comes with
very few guardrails or regulatory requirements, such as providing voice
service or being an eligible telecommunications carrier (ETC), we will
be competing on unequal footing. This is a bad result for everyone. It
is a bad result for Midco and the providers winning CARES Act funds,
because the area is not economical to serve for even one provider, and
it is a poor use of taxpayer money, because scarce funds have been
devoted to an area where multiple Federal funds were already committed.
Had there been better coordination between the two funding sources,
this result might have been avoided.
Fortunately, some progress is being made, both with respect to
coordination and ensuring that grant money is being wisely spent. The
FCC is implementing the mapping requirements of the Broadband DATA Act
to ensure that areas without broadband are more precisely identified,
and implementation of the ACCESS Broadband Act and the Broadband
Interagency Coordination Act should boost coordination efforts so that
Federal and state funds are complementing each other's efforts to
reduce the number of unserved areas. It is critical that in
implementing these directives, agencies distributing funding view
coordination with each other as an integral part of the award process,
not an afterthought.
RUS has also made improvements. During a recent round of ReConnect
funding, the RUS not only did field tests to determine if existing
service was present before making awards to certain areas of North and
South Dakota prior to issuing grants, but also provided our company
with specific information about why it was accepting or denying the
submission we filed as part of the Reconnect challenge procedures
showing that the proposed funded service areas already had access to
broadband service. That is progress.
Finally, we recommend removing barriers to entry and deployment. In
addition to improving the programs themselves, it is appropriate to
examine the regulatory landscape at the federal, state, and local
levels to ensure that obligations and costs placed on providers--
whether they offer wireless or wireline service--are reasonable,
lawful, competitively neutral, and not unduly burdensome. Eliminating
regulatory barriers to deployment (such as permitting delays and the
imposition of excessive pole attachment rates by municipalities and co-
ops), and encouraging equitable ``dig once'' policies, will help
accelerate and lower the cost of broadband infrastructure buildout.
Every dollar paid in excessive fees and taxes is a dollar that cannot
be invested in broadband, making the rollout and upgrade of rural
broadband slower and less ubiquitous.
* * *
I commend the Committee for its focus on ensuring that the billions
of dollars being spent on broadband deployment benefit all Americans--
including those in rural America. Progress has been made with the
existing Federal and state programs to target funding at unserved
areas, largely by improving the design of those programs to better
identify unserved areas and by defining broadband service in a way that
prioritizes people living in hard-to-reach areas that may require a
menu of technologies to serve each and every household. We hope that
new programs, like those included in the American Rescue Plan, will be
implemented with similar goals and guardrails in place. Thank you again
for inviting me here today, and we look forward to working with you on
these important issues.
The Chair. Thank you. Again, thanks to all the witnesses. I
am going to start, Mr. Wilkins, with you, but it is really a
question for all the witnesses. You all talked about the RDOF
auction. You all mentioned changes. Could each of the witnesses
just tell me, you know, succinctly as you can, the two or three
changes that you would make to the current system, as it
relates to the next auction? Mr. Wilkins.
Mr. Wilkins. OK, certainly. I think that one category is
there should be some adjustments to the standards required to
participate in the auction, and probably more precisely, on the
geographic scope with which you can participate. I think that
there is a well-intended desire to have a relatively low bar to
entry in auctions. You want lots of participation. But I think
it is going to prove quite unreasonable to allow some bidders
to bid, essentially in states they have never operated in. I
think that just the nature of the upfront process should be
made somewhat more stringent. There is a balancing test for
sure there, but I think it needs to shift a little bit more
into a higher showing of ability to serve an area.
The Chair. Mr. O'Rielly?
Mr. O'Rielly. Sure. There are a couple things and things I
sought and did not exactly make it into the cuts. One, I think
that we should impose broadband penalties at a much higher
lever than exists today. You can receive the funding, you know,
go a couple years, and then, fail and pay--you know, pay the
penalty if need be, or try to extract it out of bankruptcy, and
that should be done, you know----
Two is, it has to remain technology neutral and that was
something that we fought for, and I think we maintained. But
there is still a desire, and there was a desire in the
structure, and people have said this publicly, to put the thumb
on the scale, and that is problematic, in my opinion. It should
not--there should not be a thumb on the scale of how you have a
competitively neutral bidding process.
And I would refer to my friend's quote, you know, the
Ferrari one. Actually, it was mine. It was Lamborghinis and
Chevys, and we must remember that the Chevy is a very good
vehicle. And we are trying to figure out how to get broadband
to those that have nothing, and I have sat in those kitchens of
people who have nothing. And we are trying to figure out how to
solve those.
So, there are two ideas I would have--I did not win at the
Commission, that I tried to.
The Chair. OK. Dr. Ali?
Dr. Ali. I echo a lot of what was already said. My concern
was about making ineligible providers that received State or
USDA support. I think what has happened is, it is forcing
providers to make a very difficult decision. And it is also
taking the legs out from under State programs, who have been
quite aggressive. I look to Minnesota; I look to Illinois; I
look to New York, who have been quite aggressive in funding
broadband. Winners of RDOF, of course, cannot accept State
funding.
I will remind everyone that 99 percent of borrowers to the
USDA Telecom program also receive USF support. This program is
for the smallest providers, providing service for the smallest
communities. All of these providers would be ineligible--are
ineligible for RDOF support, as it stands right now.
The Chair. So, you are saying more coordination?
Dr. Ali. More coordination.
The Chair. Yes, thank you. And, Mr. Forde, did you want to
weigh in on this, changes to the RDOF auction that you would
like to see? You mentioned a few----
Mr. Forde. We were very happy with the results of the RDOF
auction, certainly for us, as a taxpaying company. Sure, we
would have liked to have won more in RDOF, but it saved $6
billion for the taxpayer and we are thoroughly planning and
will be deploying broadband out to some of those RDOF areas,
really, in a very short period of time. So, we view it as
highly successful and this will help us reach another 6,000
addresses, shortly, here. So, very exciting to be getting that
broadband out there to people who need it, quickly and
efficiently.
The Chair. Well, one thing that you mentioned that you were
concerned about, and we are certainly--I think this is now--I
was asking for specificity, now I am asking for theory here a
little bit. And that is just the, you know, the speed, the
uplink and downlink speed. As, I think, Dr. Ali, you mentioned,
one is about consumption, one is about production. And I do--I
am concerned about what we are putting out there, as it relates
to making sure that we have a full vision now. Yes, the kids
are streaming, or someone is--you know, as Mr. Forde said, he
is working on his business, someone else is doing--so, the
complexity in a household, of what you are doing. What do we do
about this issue about the rate?
And, obviously, many of my colleagues here, we are going to
be discussing many things this year here about the economic
development opportunities in rural America. We want to see more
economic activity, which would mean that we would want to have
service areas that could receive, you know, much more
connectivity that would allow them on the uplink to provide
more productive business activities. So, could--do you want to
discuss that, starting with Dr. Ali?
Dr. Ali. Absolutely, thank you for that question. I am in
favor of the 100/100 symmetric definition. I think, you know,
as we have learned, it allows people to work from home. It
allows students to study from home. I am thinking particularly
of my students who might have multiple roommates who are
sharing a connection and have to do multiple Zoom calls. You
know, a definition of 25/3 is not suitable for those students,
nor is it for a family of four who are two parents might be
working and two kids also going to K to 12.
The other thing I will just add is that this symmetric
definition is absolutely vital for business. I think
particularly of precision agriculture. I spent a lot of time in
rural Minnesota talking to precision agriculture companies and
providers. They are uploading terabytes worth of data and doing
an incredible amount of soil analysis, often times in real
time, if possible. The technology is there. They need that
ultra-fast symmetric upload speeds to enable them to make real-
time decisions about planting.
The Chair. Yes. I see my time has expired, but Mr.
O'Rielly, do you want to make a quick comment on that? And
then, we will get the rest later, for the record.
Mr. O'Reilly. Well, at precision ag, most of the data can
go--it does not have to go at once. It can go at different
times and so, you do not have to have related speeds. And in
terms of the 100/100, the 25/3--the 25 that we have to exist
today has been incredibly functional and I have seen data that
suggests that you can have six Zoom calls happening at upload
speeds of 5, 3 to 5.
So, to go into 100 to fulfill a desire--and I know there is
interest in expanding the speeds, but there has to be a
limitation on how much we can afford to fund at one time.
The Chair. We will get more from our other witnesses on
this. I think this is a very important point on the economics
of auctions. And so, anyway, Senator Wicker.
Senator Wicker. Madam Chair, this is such important subject
matter, and these are such excellent witnesses and we have so
much to cover. I am almost tempted to move that we just have a
weekend away from all the distractions and really get into
this. Of course, our staff members are not able to do that. But
this is such a crucial matter for us to talk about and so many
great opportunities for us to move things along.
Mr. O'Rielly, you have a--you come to us with a unique
perspective. Last year, then Commissioner Rosenworcel, now
Acting Chair of the FCC, said the broadband maps could be
updated within just a few months, and then, recently--and
sometimes I have had to eat my words, but recently, she said
no, it would not be completed until 2022. Given your extensive
knowledge of the internal functioning of the FCC and its
broadband maps, how quickly do you think the Commission should
be able to complete the new broadband maps, now that it has
proper funding?
Mr. O'Rielly. Well, I apologize in the sense that I have
been removed to know what she based her new data point on, in
terms of the year timeframe. But I think it comes down to
priorities, and this committee has given the FCC new priorities
in statute. But here is one where, you know, if the
determination is made by this committee, it should be one of
the highest priorities, if not one of the, you know, one or two
or three, that would be taken heat at the Commission.
Senator Wicker. So, is it you testimony that, if the
Commission makes it a priority, that it can be done within a
matter of months?
Mr. O'Rielly. Well, I do not want to say that months, I
cannot specify, since I am outside of the game, or outside of
the conversation, to--but it does meet its deadlines. It had a
past failure. It used to--when I worked in a different setting,
they used to miss deadlines, and I found it very frustrating.
But this Commission, the last couple Commissions, have met
deadlines in an extraordinary staff time and effort. And so, if
the demands are asked to award by this committee, they tend to
meet them, and they could meet them if it was--and expedite the
timeframe, which I think is absolutely critical and I support
you.
Senator Wicker. It is absolutely critical, and it is
because it is holding us up if we do not get that. And this is
not a partisan issue. We just need to dig into this and figure
out what we can do, as members of the House and Senate, to move
this along.
Dr. Ali, do you have some insight for us on this topic?
Dr. Ali. Thank you for the question. I would just say that
I appreciate the need to bring in multiple stakeholders in this
situation. I think that when the FCC initially considered
mapping and remapping, we heard, you know, a big push from U.S.
Telecom and that may have been it.
I think one thing that we are learning about, with mapping,
is the crucial, crucial role that states are playing. I am
really energized at what is going on in Georgia right now, and
the innovated partnership with a real estate data company to
get that granular address level data. I think we are seeing the
development of some pretty important best practices that can
hopefully be implemented and might be able to speed up the
process.
Senator Wicker. Well, if we are not inside the FCC, and Mr.
O'Rielly is not inside the FCC right now, how do we get the
information? How do we know what is what?
Dr. Ali. My opinion is----
Senator Wicker. An outsider and an academic like you, help
us to know what is attainable and how quickly?
Dr. Ali. I confess, I do not know how quickly what could
happen and what I am about to propose. But I do think we need
to start thinking about data inputs from multiple stakeholders.
This cannot just be about providers, but we need to have a
crowdsourcing option, as well, and I know that the FCC is
investigating that. But that is not an easy process. It is not
easy to make all of these different layers on a map. As for
speed, you know, I am going to trust FCC Acting Chair
Rosenworcel that she knows best on how quickly this can be
deployed. But I would, you know, encourage everyone to look at
the importance of crowdsource data, the work that Measurement
Lab is doing. And again, I think it was quite innovative that
Georgia partnered with a real estate data provider, to be able
to get address level data.
Senator Wicker. Well, you know, I am sure the Acting Chair
is listening right now, and I think Senator Cantwell and I want
to know what we can do--what we can put on paper to have the
President sign, that will help the FCC get this down quicker?
I am not going to ask Mr. Forde, I am going to ask both of
you to comment about his concerns, it is on page 10. But you
listened to his testimony, but what areas that I find is
eligible for funding, unless they have a high level of service,
such as recent proposals suggesting an increase to 100/100,
this means that many areas where investments have already been
made, including through public and private programs, are
suddenly considered unserved, therefore, will have duplication.
Mr. O'Rielly, what do you think about that? Does that make
sense?
Mr. O'Rielly. I agree with his point. It does not make
sense to do that, in terms in of policy. It will wipe out
almost all of the work that the Commission has done.
Senator Wicker. So, his conclusion is correct?
Mr. O'Rielly. I believe so, yes.
Senator Wicker. And Dr. Ali, what do you think?
Dr. Ali. I am not entirely sure. I was--I am disappointed
when a provider uses the 25/3 as a ceiling to meet, rather than
a floor to buildupon, and I think too often we have seen
providers use 25/3 as just meeting that ceiling and then,
checking that box. I think that 100/100 definition would force
providers to reconsider deployment strategies, and would start
to phaseout, as we are already seeing, some of these
technologies that we know cannot meet the needs and uses of
contemporary Americans, especially a country of living,
working, studying, communicating online.
Senator Wicker. Think that through and take that for the
record, whether we are going to start duplicating because now
we have something that is a little easier to do, the 100/100.
So, take that for the record. All right, and we will try to
formulate that, so it is clear what we are trying to get to.
Thank you both. I think these are all four terrific
witnesses, Madam Chair.
The Chair. I agree, and thank you, Senator Wicker. And we
will--I just want to point out, I did have a conversation with
Acting Chair Rosenworcel, who intimated she thought this was a
4-month answer, to get on the mapping. But I remain committed
with you. I think we should look at every avenue we have to get
this data and information, including whatever the FCC is doing,
or other ways. And proud that we have been able to do some
crowdsourcing in the Northwest, but----
Senator Wicker. I hope that that is correct. Four months
sounds doable, and I think it is something the Senate expects.
The Chair. That would be great.
Senator Wicker. If it is indeed possible.
The Chair. Yes.
Senator Wicker. Thank you, ma'am.
The Chair. So, thank you. Thank you, Ranking Member.
Senator Klobuchar, you have been--your state has been
mentioned. You have been mentioned. Thank you for your----
STATEMENT OF HON. AMY KLOBUCHAR,
U.S. SENATOR FROM MINNESOTA
Senator Klobuchar. It is a very exciting day for me.
The Chair. You have been----
Senator Klobuchar. And it is St. Patrick's Day, so we are
feeling good.
The Chair. Good. Well----
Senator Klobuchar. All right. Well, thank you very much,
Chairwoman, and thank you, Senator Wicker, as well, for both of
your leadership on this. I think we all know the pandemic has
put one big magnifying glass on this problem that we all know
existed. And having been to Iceland, I just do not understand
why they have better Internet than we have in America, but you
can reach corners of Iceland over volcanoes and you still
cannot reach, with high-speed internet, parts of Southern
Minnesota or Northern Minnesota. So, that is how I go into
this.
I think it is so important, when we have got kids that are
having to learn the mute button to learn to read, and parents
with their toddlers on their knees and their laptops on their
desk. And we know that this pandemic, as we see this lighthouse
in front of us, that we are going to get through this, we still
know that it has forever changed the way our people are going
to communicate, and we cannot have haves and have nots.
So, I will start with the bill that I am leading with
Representative Clyburn. I am so proud we have six members of
this committee on the bill. I will start with you, Dr. Ali.
Could you talk about the need for forward-looking with
broadband? You mentioned precision agriculture and the need to
help small businesses, and why we need this kind of funding,
for once and for all, to get through this.
Dr. Ali. Absolutely. Thank you very much for the question.
I like to think about--when we think about high-performance
broadband, particularly in rural America, we have five pillars.
We have got pillars for telehealth, education--we know that
there is a grade point, one grade point between separating
those students who have broadband and who do not. We know that
folk are struggling to sign up for vaccines without a broadband
connection.
We also know that high-performance broadband attracts
businesses. I was doing some work in Rock County, Minnesota
and, for a brief point, they had attracted a shrimp company to
come----
Senator Klobuchar. Yes, I am well aware of this issue.
Dr. Ali. And they were attracted there because they had
fiber. They had fiber in the ground. In fact, Rock County is
the most connected county in Minnesota.
So, I think that, you know, for all of these reasons--small
businesses, working from home, studying from home, the 100/100
definition, but then, also the $80 billion for deployment is
absolutely crucial.
Senator Klobuchar. Right, and you mentioned how giving to
underserved areas is so important. And, Chair Cantwell, I have
a letter from the Leadership Conference on Civil and Human
Rights, which represents over 200 national organizations
expressing support for a broadband infrastructure with Majority
Whip Clyburn, The Accessible, Affordable Internet for All Act,
which I would like to submit for the record.
The Chair. Without objection.
[The information referred to follow:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Senator Klobuchar. Thank you very much. Briefly on that,
because I have questions of other witnesses, Dr. Ali, what this
divide is, when it comes to race, when it comes to smaller
towns, and the like.
Dr. Ali. Well, we know--I think all too often we think
about the digital divide as being one divide, as the divide
between rural America and urban America. But as we have learned
in the last year is, the real divide is intersectional. It is
about race. It is about income. It is about geography. It is
about affordability. It is about students.
So, there are multiple digital divides. One of the ones
plaguing rural communities the most is, of course, the divide
of infrastructure. But that does not mean that there are not
problems with affordability. That does not mean there is not a
problem with availability and computer use and digital
literacy. So, this needs to be--this is an opportunity for us
to really attack all of these issues. The digital divide is not
a zero-sum game----
Senator Klobuchar. Exactly.
Dr. Ali.--where we fund one and not fund the other. It has
to happen at the same time.
Senator Klobuchar. OK, thank you. Mr. Wilkins, one of the
bills we have out there that is bipartisan, 15 Democrats, 13
Republicans, Senator Kramer and I have introduced, which
focuses on Internet services to students, rural and low-income
families, and that is a $2 billion fund. Could you just very,
like in the 30 seconds here, mention the importance of that
bill?
Mr. Wilkins. Absolutely, and in my mind, that is especially
important because it actually gets at the deployment challenge,
as well. If you are building a broadband network in a rural
area, you actually are very, very interested in the ability of
families in that area to afford service on your network. And
having that kind of funding to support that kind of distance
learning in a very important part of the, frankly, the revenue
side of a business case for deploying in rural areas.
Senator Klobuchar. Exactly, because some area, some
providers are doing this, some are not. As you have pointed
out, Mr. Forde, which I appreciate, and I appreciate your work
in Minnesota. Last question is along the lines of what my
friend, Senator Wicker, was talking about. This is our bill,
and we are proud to have several others on it, as well. The
Broadband Data Act, as he has mentioned, it has been passed.
Just talk about how this would help us, despite everything good
you have done in Minnesota, we still have areas that are not
covered, and we have got to make the case for where we need the
money and where we do not. Mr. Forde.
Mr. Forde. Yes, thank you very much, Senator. Pleasure to
do a lot of great work across the state of Minnesota. You know
we are--I have an excellent GIS department. We stand ready to
provide that data and we love working closely with the State of
Minnesota and the Broadband Office. If there is ever a data
discrepancy, right down to the address level, they call us. We
certainly get that worked out, and make sure that we know the
exact areas that lack access to broadband and really like the
way that their office is very surgical, in attacking areas.
They pulled out all of the RDOF areas from their latest
grant round, to ensure that Federal funding would not be
duplicated with their state funding. You have an excellent
challenge process with their grants, as well. There was a grant
that we applied for and the provider agreed to upgrade their
service, and we did not get. There was another instance where
we applied--or another provider applied for a grant for an area
that Midco was going to build with capital in 2022, and they
pulled that grant. So, that would just being using private
capital.
So, really like the way that they are really focused, right
down to the address level, and work very, very closely with
companies who have this data from excellent GIS departments, to
ensure that the funding is targeted.
Senator Klobuchar. Exactly.
Mr. Forde. And I think, if we can implement some of those
things at the Federal level, that will help.
Senator Klobuchar. And I think Senator Wicker sees this. We
have got to do both things at once because, once we get the
money we want to target it. And good to see you, Former
Commissioner, thank you.
The Chair. Thank you for your leadership again, Senator
Klobuchar. Very much appreciate. Senator Thune.
STATEMENT OF HON. JOHN THUNE,
U.S. SENATOR FROM SOUTH DAKOTA
Senator Thune. Thank you, Madam Chair, and I would say to
my colleague from Minnesota, if she needs a St. Patrick's Day
mask, I have an extra one of these around.
Senator Klobuchar. That would be a Packers mask. Very nice,
Senator Thune, and I noticed you have kept it on through the
hearing. I really appreciate that. I will wear a Vikings----
Senator Wicker. It is all he could find at the last minute.
Senator Thune. Just for you. I want to thank you for
holding the hearing and also like to welcome Mr. Justin Forde,
from Midco Communications, which is based out of Sioux Falls,
South Dakota, to today's hearing. And I noticed his backdrop,
he looks like he is on top of a cable tower there, although, I
think the background would be white, if it were current.
But anyway, I want to thank all of the witnesses for their
participation today and just indicate that, as has already been
mentioned throughout the Coronavirus pandemic, reliable
broadband services have been vital to many Americans' lives.
And in recognition of this Congress acting in a bipartisan
manner, provided USDA's ReConnect program, $100 million through
the CARES Act, and an additional $635 million under the year-
end bipartisan Coronavirus relief package, which also gave NTIA
over $1 billion to support broadband deployments in Tribal and
rural areas. And at the same time, the FCC, under then Chairman
Pai's leadership, awarded $9 billion through the RDOF Phase I
program and will be making an additional $11 billion available
for Phase II.
It is my hope that this committee and Congress will take a
pragmatic approach when considering additional measures to spur
broadband deployment. And as we continue to work to close the
digital divide, we need to work, I believe, in a bipartisan
fashion, to ensure a proper oversight of the agencies
responsible for distributing billions of taxpayer dollars to
support broadband services. Really important, I think, that we
get lead on the target.
So, Mr. Forde, let me ask you, if Congress considers
additional funding for broadband services, do you believe that
funding should be additionally targeted to truly underserved
areas?
Mr. Forde. Absolutely. We have got to focus like a laser on
those truly unserved areas and get service out to those folks
as soon as possible. And we know where those areas are and we
know how to reach them, quickly and in an efficient manner.
You know, just to go back and talk about a few of the other
things that some of our panelists have done here--you know, I
have a family of five and they were all learning during the
pandemic with speeds of 25/3. So, that is certainly sufficient
for our family through this. That speed is not a--it is not a--
it is not the floor--the ceiling. I can get much more speed
through that connection that I wanted to, should I choose to
purchase it.
In regard to the symmetrical speeds, you know, in our--
regardless of the technology we offer, whether it is fiber to
the home, that hybrid fiber cable mix, or fixed wireless, it is
about 14 to 16 times higher in the download speeds than the
upload speeds. So, we are actually doing broadband on the
ground. Our customers are not taking those symmetrical speeds
that they need.
Particularly, when we choose technology, we want to choose
the connectivity that the farmer wants. A lot of farmers in
these days do not want a fiber line to the farm. They want
connectivity to the entire farm. In fact, we have a farmer that
has two farms, 75 miles apart. He can use fixed wireless
technology and get connections to both of those, for less than
$100. The cost of running fiber to those would not be
economical to us, or for the Federal Government to serve both
of those farms, so he can see what is going on in each of
those, each and every day.
So, a lot of things going on out there. This in the back,
as you mentioned, this is actually an elevator, 190 feet up
behind me. I would also mention that the town below, about 350
people, all of whom have Gigabit service. The farms, hundreds
of them in the vast agriculture area out, could all get--also
get 100/20 service out in those farms shortly, from Midco. All
those areas, if the speed changes, would now become eligible
for Federal funding.
So, it is important to remember that the speed is here. It
is available and ready to go, and we do not need to make these
areas behind me, that already have broadband service in
agricultural areas, delivered in the best way to serve those
residents and customers that they want, is not implemented or
changed by a Federal rule made in Washington, DC.
Senator Thune. Well, and there are so many good--a lot of
applications in agriculture, and so many other areas, that
benefit from that technology as it is delivered into those
rural areas in, hopefully, as you pointed out, the most
affordable form.
Mr. O'Rielly, just a comment, too, on the question, do you
believe that funding should be efficiently targeted to truly
underserved areas?
Mr. O'Rielly. Absolutely. To the point I made earlier, and
it has been made by Mr. Forde, is that if you do not target the
funding, you will have exactly the situation he just described.
Dollars will go to those areas that already have broadband,
versus those that are unserved today. And they will be pushed
on for another day, another day, another day, as they have been
before. That is what happens when you raise the speeds. And I
have mentioned this a number of times, when I was at the
Commission, and I do now. If you raise the speeds to the levels
we are talking about, almost everything gets wiped away. All
the Commission programs, all the--most of those at USDA, all of
those are going to be wiped away and we are at a new structure.
Senator Thune. And just very quickly, I have introduced a
bill last year that would capture revenue generated by spectrum
auctions at the FCC to support broadband deployments in rural
areas like those in South Dakota. Do you support proposals like
this that take a more targeted approach to fund broadband
services?
Mr. O'Rielly. I do. The only thing I would mention they did
last year is that sometimes the auctions can be cyclical or
have different pluses and minuses. So, not every year is a
balance. So, there is some concern there, but otherwise,
absolutely.
Senator Thune. OK, all right, good. My time is expired.
Thank you, Madam Chair.
The Chair. Thank you--thank you, Senator Thune. Senator
Markey. If not--Senator Blumenthal, you are actually next, but
we thought you were on your way. Are you ready, or should we go
defer to someone else?
STATEMENT OF HON. RICHARD BLUMENTHAL,
U.S. SENATOR FROM CONNECTICUT
Senator Blumenthal. I could go, yes.
The Chair. OK, you are up. Thank you so much. We wish you a
happy St. Patrick's Day! OK, Senator Blumenthal, thank you so
much for your questions.
Senator Blumenthal. Thank you, Madam Chair and really
appreciate your holding this hearing. I know we share a very
urgent interest in this topic and really am grateful for the
opportunity to have excellent witnesses before us today. Thank
you both, and all of our witnesses, for being here.
I think that the fact of this hearing reflects our
commitment to families desperately in need of broadband, and
they need it right now. I also appreciate the leadership of my
colleague, Senator Klobuchar, on the Accessible, Affordable
Internet for All Act. I am proud to co-sponsor this bill, which
would provide grants to expand broadband and promote real
competition.
In Connecticut, our Governor has set an ambitious but
necessary goal of connecting every home to broadband in less
than 6 years. I say necessary because, as this pandemic has
shown, broadband is an essential need, not a luxury, not a
convenience. We need to take broadband as seriously as we do
access to electricity or water or any of the utilities that,
sometimes, we take for granted, until we do not have them, as
the people of Texas recently saw.
The Accessible, Affordable Internet for All Act would be
the fuel that states need to achieve the common sense goal of
universal broadband access. And I want to offer Connecticut as
a model for state leadership and public-private cooperation to
close the homework gap.
Professor Ali, Mr. Wilkins, the digital divide affects far
too many households and far too many people in the heart of
urban and suburban communities. It really cuts across all of
our communities. The FCC's mapping and funding programs have
long neglected their needs. Can you tell me more about how
broadband grants would help states, specifically like
Connecticut, to ensure that all households, including those in
cities and suburbs, have access to high-speed broadband?
Dr. Ali. Perhaps I will jump in first, Senator, thank you.
I think it is a great question. And I think what you are
pointing at, too, is the vital importance of state broadband
offices as a fundamental middle point between Federal funding
and their communities. States know their communities better and
best. And I think this is some of the amazing research coming
out of the PEW Foundation, what the best practice is for highly
regarded state broadband offices that can really target those
fundings. Not just toward rural, as he mentioned, but toward
urban and suburban areas, as well.
Mr. Wilkins. Yes, Senator, thank you. And I would just add,
again, I strongly believe that affordability and accessibility
to an individual person out there, is just the same thing. It
is I do not have the broadband that I need. And I do think that
the role of states to more carefully tailor certain funding to
what is actually true in their states is critical.
I will just give you one example. In a more urban area, you
might have apartment buildings that have a lot of folks that
need affordability support, and that is the reason they have
not been served with a good broadband. It is because the
provider said, well, there is not enough, essentially, revenue
demand there in that building. A state-tailored program, that
specifically helps support those customers to be able to afford
broadband, and ideally structures the program in a way that is
predictable for a provider, but actually get a provider much
more willing to serve that location. And I have heard there are
many versions of that in different states of the country.
Senator Blumnthal. I think, the point that both of you are
making, and others have made today, but it really needs to be
repeated, this issue affects suburban, urban, as well as rural
communities, and overlooking the City of Hartford or Waterbury,
Stanford, New Haven, big cities or their suburbs, is to ignore
seniors and communities of color, which often lack access to
broadband. It also ignores the digital divide that separates
those communities from others, in our state. Even a small state
like Connecticut can suffer from this kind of homework gap or
digital divide. And I think the testimony today has a powerful
exclamation point to that very urgent fact about the need for
this kind of legislation.
So, thank you all. Thank you for being here and adding to
the immense resource this hearing will be for us. Thank you. I
yield and now call on Senator Fischer.
STATEMENT OF HON. DEB FISCHER,
U.S. SENATOR FROM NEBRASKA
Senator Fischer. Thank you, Senator Blumenthal. The Federal
Government has a crucial role in promoting the availability of
broadband services for all Americans, especially those in hard-
to-reach areas that lack that connectivity. Right now, 27,000
households in Nebraska, they do not receive the broadband
service that meets the FCC's current definition. Meanwhile,
Congress has provided over $20 billion in broadband funding
this past year.
We must have clear organization and accountability measures
in place to ensure we maximize the reach of Federal dollars and
support these sustainable networks. For years, I have heard
about the increased need for coordination between the broadband
deployment programs at the FCC and RUS. And now, NTIA has a new
grant program for state and localities to also buildup
broadband. Mr. Forde, if I wanted to track where all this
funding is going, is there a single map that I can look at
today? And if not, would it make sense for the FCC to be tasked
with mapping that, as well?
Mr. Forde. Absolutely. You would have to visit multiple
different websites, which we do on a regular basis, with, you
know, all the different Federal resources, cities, counties,
and compile that data. Takes a tremendous amount of work to put
that together into our GIS department, so we know where folks
are. We are constantly playing offense and defense, right? We
may have grants that are from one agency that are trying to
overbuild areas that we serve. Another area where finding an
unserved area and sometimes it is a competition between whether
we are going to go there with private capital, other Federal or
state grants trying to reach there.
Not an efficient process at all and, yes, the FCC can be a
great help of making sure that all these agencies know where
broadband is going, with government help, but also, where
private sector funding is going, right? We have buildup plans
for up through 2025. That is areas, that we are going to
deliver broadband to with private capital. We need to make sure
that the government entities are aware of that, and do not
award government funding to areas that we would already be
going to with private capital anyway.
So, certainly there is a lot of things that we can do, and
the FCC can do, to work with providers to make sure that we
have got those maps right and there is coordination between all
of those agencies. And I will also add the new CARES funding to
that, as well. You know that money seems to be going out to
state and local areas. No guardrails, no rules with that, and
is being spent on broadband, and a lot of duplicative efforts
going on there with that funding, as well.
Senator Fischer. OK, thank you. Mr. O'Rielly, as the FCC
updates its broadband coverage maps, what are your thoughts on
whether the agency should create a map that tracks broadband
funding, including what is available, where it has been
awarded, and when it would be built out? Do you think that is a
good idea?
Mr. O'Rielly. Well, I want to be careful awarding new jobs
to my old--former colleagues, but I will say, yes, absolutely.
We need to have better handle on how the funding is going out
and going to these different programs. And I would say also, to
compliment that, we ought not to be creating new, different
pots of money for different agencies. It is one thing to say
let us coordinate. It is another to maybe not stop just doing
so. I think creating five or six different sources that are
competing against each other, like Mr. Forde said.
Senator Fischer. I agree and areas that already have that
broadband available, to have more money put in there, I think
it is misuse of taxpayer dollars. You know, if our goal is to
make sure that broadband is available across this country and
meet the needs of people no matter where they live, we need to
know where it is and where it needs to be.
Mr. Wilkins, in your testimony you stressed the importance
of focusing on performance profile of a network, beyond just
promoting competition among different technologies. What are
the main elements of this performance profile that you think
would make communication networks deserving of Federal funding?
Mr. Wilkins. Thank you, Senator, for the question. I think
there are two that are most important. I think, first and
foremost, is scalability and then, second is reliability. But
on scalability, you know, I think it is worth just pointing out
that the debate over speeds and who is overbuilding who at a
given moment, really just reflects the debate we have been
having for 20 years, right? What speed is the next step that
needs to be better? I think a performance metric that says
scalability is what matters, so that we can stop having the
debate every 5 years about, well, what is the next increment we
need to get to, is actually probably the wisest choice.
The analogy, I would say is, you know, when we built the
interstate highway system, did we overbuild the old, you know,
local routes? Well, no, what we did was, Congress said that was
the performance standard we needed, and that is what we did.
Reliability, also, I would emphasize. You know, those of
use that have been in telecom for a while remember back when
the old Bell system said five nines reliability. You know, only
down 6 minutes a year, is what was critical. I think that is a
performance dimension of a network, that could get more
emphasis in this sort of funding process.
Senator Fischer. Do you think that the FCC and other
agencies should be considering that when they are awarding this
kind of funding?
Mr. Wilkins. Yes, I mean--so, that is a very good example--
--
Senator Fischer. And the amount of money we are talking
about.
Mr. Wilkins. Yes, yes, I am sorry for interrupting. I think
that is a great example of the kind of implementation change
that can be made in future award processes, right? I mean, RDOF
only rewarded speed and latency, and those are important, but
they are not the only dimensions that matter, if we are talking
about this size of an investment.
Senator Fischer. Thank you very much. Thank you, Senator
Blumenthal.
Senator Blumenthal. If I could recognize Senator Markey
next.
STATEMENT OF HON. EDWARD MARKEY,
U.S. SENATOR FROM MASSACHUSETTS
Senator Markey. Thank you, Mr. Chairman, very much, and I
am going to direct my first question to Mr. Wilkins.
Mr. Wilkins, we clearly have a huge problem in our country,
right now, where upwards of 12 million American children still
do not have the Internet at home and we know who they are. They
are largely black and brown. They are poor, immigrant children.
And obviously, that is leading to a huge learning gap that is
going to lead to an opportunity gap because this homework gap
sits there and needs to be addressed.
So, in the American Rescue Plan, my amendment--my program
was adopted, that adds $7 billion for this year, in order to
make sure that we have the funding for these young people at
home. So, my question to you is, how important is that program,
the $7 billion for kids, right now, given the fact that we are
probably going to stay with the hybrid model for learning, for
some extended period of time, and we know the kind of kids who
are most negatively impacted? So, from my perspective, should
the program be made permanent, and do you think it is going to
make a big difference in helping kids to get access to the
educational opportunities, which they need?
Mr. Wilkins. Thank you, Senator. You are right, it is a
hugely important program. I mean, first, I will just say,
helping those children learn, very important. But I think, more
in my specific realm of expertise, I would just emphasize how
important that is for the deployment gap as well, and
especially the idea of making it permanent.
If you are looking to deploy a new broadband network, there
might be one high school in the rural area or, you know, a set
of families that, if they could afford your network, they would
be more than happy to help you sustain it. But if you do not
know that is going to be available for the long term, you
cannot factor that into your deployment. So, very important,
obviously, but the permanent status is very important, to
support the deployment side, as well, I would say.
Senator Markey. No, thank you. And again, kids can get it
on their school desk for free. They can get it in the library
for free. But for a lot of these kids, it is public education.
They need it at home, as well. And that is why I think it is so
important that the program was included in this package. And I
think that students are not the only ones without connectivity.
We have larger problems in our society, as well. I have
introduced the National Broadband Plan for the FUTURE Act. It
is legislation to update the National Broadband--the FCC had to
construct 10 years ago, pursuant to my amendment that was made
a part--law in the 2009 Recovery Act.
Professor Ali, how important do you think it is that we
update the National Broadband Plan, so we have a plan for the
next 10 years, or 20 years, in our country?
Dr. Ali. I think it is absolutely important that we do
this. I will also add that, in 2008, under the Farm Bill, we
were actually ordered to have a National Rural Broadband Plan,
and that was authored by then Acting FCC Chair Michael Copps in
2009, and then, 6 months later, we had the National Broadband
Plan. This speaks to the importance of having different
strategies for approaching and correcting the different types
of digital divide. And maybe, then, also anticipating new
divides that are going to come up along the way.
Senator Markey. Thank you. And if I may, Professor Ali,
just follow up on one other question, which is, the resiliency
of our telecommunications networks. There is more than 4,000
miles of fiber optic cables within the next 15 years that could
be submerged. Senator Wyden and I are drafting legislation that
will fund projects to strengthen our networks against climate
change, while simultaneously reducing the carbon footprint of
our telecommunications infrastructure. Could you talk about the
importance of hardening our communications infrastructure in
the country, against climate change?
Dr. Ali. I am absolutely happy to, Senator. This is of
vital importance. It is of vital importance for first
responders, and it is of vital importance for those who may
need help during this time. I think particularly of what
recently happened in Texas and Hurricane Irma and Maria in
Puerto Rico, of the vital need to have a robust and resilient
telecommunications system, again, for first responders and for
those impacted.
Senator Markey. I could not agree with you more. That is
just a preview of coming attractions, what has happened in
Texas and in Puerto Rico. So, we just have to understand that
our communications system is going to become more and more
vulnerable if we do not harden it.
So, thank you, Professor, and thank you, Mr. Chairman, for
the recognition.
The Chair. Thank you. Senator Moran? I do not know if he is
joining us online? If not, Senator Sullivan.
STATEMENT OF HON. DAN SULLIVAN,
U.S. SENATOR FROM ALASKA
Senator Sullivan. Thank you, Madam Chair, and I want to
thank the witnesses here. You know, I just came from an EPW
Committee hearing on the issue of drinking water in America,
now we are talking about broadband. And what I want to do, I
want to focus on this issue of the truly unserved communities.
Because when we talk about speeds and overbuilding and
resiliency, and it is all important, but there are communities
in America, in my state in particular, that, for example, in
the previous hearing, do not have any running water. No flush
toilets. American citizens, thousands of them. So, when we talk
about infrastructure for upgrading water and sewer
infrastructure, my view is you have got to start with the
people who have nothing. Similarly, with broadband. I think the
truly unserved, in my state people just do not have it. It is
not about upgrading speeds. It is not about resiliency. They
have nothing.
So, the discussion here is really important. I know there
is a lot of bipartisan focus on this. But I think, before we
talk about upgrading speeds, and everything else, we have to
get to the people who have nothing. And unfortunately, a lot of
my constituents do not have anything.
So, Mr. Forde, Mr. O'Rielly--by the way, Happy St.
Patrick's Day--how do we get to that spot where we have all
this money, but where we can focus our efforts on just making
sure the most basic needs--anything, we hit that. because we
have been doing broadband for a long time, but there are still
communities, whether in Alaska or, I am certain other states,
that have zero, and I think we have to prioritize these
Americans first.
Mr. O'Rielly, you want to tackle that one?
Mr. O'Rielly. I would absolutely agree with your statement
and it is what I spent my time at the Commission focused on.
How do you deal with those that have absolutely nothing? And I
have sat in the kitchens of the families who had to lose
their--you know, their job was moving away, and they were
allowed to telework, if possible, and they had no broadband to
be served. So, they were basically unemployed because of it.
And so, I have done that, and I absolutely agree with you.
What happens when you increase the speeds--and we have done
it a couple times? When I first got to the Commission, we were
at 4/1 and then, when everyone wanted to go to 10/1, and then,
Tom Wheeler, the former Chair, said we needed to go 25/3,
because only that is table stakes. In doing so, we ignored
everybody who had nothing, and that is how the debate is going
right now. How do we go to 100/100, or things that people do
not necessarily need in most instances, when people have--a
good portion of people--and we can debate how many people,
whether it is 12 million, 20 million, whatever. We can debate
that, but we know they have nothing, and a lot of people in
Alaska have fallen in that situation. That is what I cared
about, and I would say, hold off on the speeds and focus on
those--I go to Mr. Forde's point. Stay focused on the unserved.
Senator Sullivan. So, thank you, and by the way, I thought
you did a great job as Commissioner, so wish you were still
there.
Mr. Forde, do you have a view on this? I know you care
about it. But again, this should not be a controversial topic.
It should be, let us start with the people, who have nothing.
It is the same with drinking water, right? Like, I cannot
believe that I have to go to hearings and pound the table and
say, I have thousands of constituents--by the way, some of the
most patriotic Americans in the country, because they all serve
in the military--and they do not have flush toilets or drinking
water. Broadband is kind of similar, becoming similar.
Mr. Forde, what do you think? What can we do here? I do not
think it is terribly controversial, what I am talking about.
But as Mr. O'Rielly said, the conversation quickly goes to
bumping up the speeds versus focused on the people who have
nothing.
Mr. Forde. Absolutely. We could not agree more. We have
seen, in some of the Federal programs, even when they have come
out with at bidding round, there have been areas that have
gone, in our footprint, that have really gone unbid, right? And
those areas are the ones that still lack broadband. Billions
and billions of dollars are awarded to other areas, and we go
to work, you know, building those areas, while other areas
remain largely unbid in some of these auctions. Nobody has even
bid on them.
Another in particular instance, which was very
disheartening, in one of the states we served, they upped the
speed limits from 25/3 to 100/20. One hundred percent of the
applications went to areas that already had 25/3. So, $11
million was awarded in Federal funding to those areas. They did
not get one house closer to closing the digital divide in the
entire state, because of the upping of the speed threshold from
25/3 to 100/20.
So, that is just what happens when you change those
thresholds. Providers will build in the areas that it is easier
to build to, closer to the areas that they serve. They do not
stretch out to reach those areas that truly do not have it, and
that is what we are seeing and why the digital divide is not
being closed, and still leaving that small gap that is out
there.
Senator Sullivan. Well, Madam Chair, I think this is an
area for bipartisan cooperation. I am sure Senator Tester would
agree. But if we can work on this, because I do not think it is
controversial and maybe the witnesses--and I am sorry I did not
get to ask Professor Ali and Mr. Wilkins questions. But if you
have ideas or language that can help us with this, I think it
is really important and I do not think it is controversial. I
think it is imperative.
The Chair. Thank you. Thank you, Senator Sullivan. I
definitely believe in an Alaska plan. I think Alaska is so
unique it requires, you know, specificity to how we are going
to achieve what we need to achieve. I know the FCC had
something. I do not know how successful it was but look forward
to working and talking to you about that.
Senator Sullivan. Thank you very much.
The Chair. Senator Tester.
STATEMENT OF HON. JON TESTER,
U.S. SENATOR FROM MONTANA
Senator Tester. Thank you, Madam Chair, and I want to thank
all the witnesses. I want to especially thank former
Commissioner O'Rielly for being here today. Look, there were
times that you and I disagreed in the past, but I am going to
tell you, right up front, I appreciate your backbone, and this
place needs more of that. So, thank you very, very much.
Look, I come from an area--Senator Sullivan talked about
it--where I have watched population decline year after year
after year. I have watched small towns dry up and continue to
dry up. And I am asked many, many times what can be the
solution for rural America, as far as getting some people to
live there again, and I think it is broadband. I do not think
there is any doubt about it. And it goes back to what Senator
Sullivan said, if you do not have the service, you are not
going to get the economic value from that service. You are not
going to get the population growth that I think, potentially,
is out there in places like Montana, and many, many others.
It distresses me greatly to hear Mr. Forde talk about the
fact that there are three different Federal pots of money going
to one area that may already be served, in his region. And I
think that if we do nothing--if nothing else comes out of this
committee, it is the fact that we need to get this money
targeted because, quite frankly, that is a waste. And there has
been hundreds of billions of Federal dollars go into broadband
and yet, it does not seem like we are getting the bang for the
buck out there, that we need to get.
I do not want to pick on the legacy carriers, but I am
going to tell you, in my office, that is where we get most of
the complaints. It is from the legacy carriers. And I would
just ask, and this is going to be like putting the ball on the
tee for Mr. Forde, which is fine by me, but how do we make sure
that the small providers get a cut? And I want to start with
you, Mr. O'Rielly, with that question. How do we ensure the
small providers get a fair cut? And then, I am going to go over
to you, Mr. Forde.
Mr. O'Rielly. Well, when I was at the Commission, I pushed
very hard that we open up the universe. When I got to the
Commission, we had a program that was only for legacy
providers. I thought that was bad then. We moved away from that
and we opened up the door for anyone who could provide
technology neutral--whatever the solution may be for an area,
to be able to serve the consumer that needs the broadband
services.
So, it is having broad acceptance. And that is where you
see policies shifting, where people want to protect their own--
you know, their own needs. And that is problematic, from my
viewpoint. But for the small providers, there can be things we
have done in other universes, whether it be plus ups in terms
of--you know, but it is more in terms of the area itself that
needs more support, than it is in terms of the company
themselves.
You know, the big provider, as you say, you know, are they
eligible? Should they remain eligible? Are they able to meet
the obligations? And that is where the Commission has done
fairly good work, in my opinion, first on the short from, and
now, they are doing the long form on things like the RDOF
program, to try to get to those issues.
Senator Tester. Mr. Forde, do you want to respond to that
question?
Mr. Forde. Oh, I--you know, to piggyback on Commissioner
O'Rielly, you know, our first foray, we have been long building
broadband since 1996, all using 100 percent private capital.
Our first funding that we accepted was actually in the CAF II
auction. So, that--when that was opened up to all providers,
that really gives us the chance to go out there and compete for
funding in those areas that some of those other folks were in,
when those became available. And really, you know, opens it up
to as many people as possible to participate in these programs.
So, we really liked that change. It led to our first, you know,
time in accepting Federal funding for some projects.
Senator Tester. OK. This is a question, I think, best for
Professor Ali and Mr. Wilkins, and it deals with low Earth
orbit broadband which, by the way, in rural areas is pretty
damn appealing if it works. If it works is the question. And
so, Mr. Ali, can you talk about low Earth orbit broadband and
tell me if it is the panacea that I think it may be?
Dr. Ali. Thank you very much for the question. I think that
there is a lot of hype, right now, around low Earth orbit
broadband, LEO broadband. We do not know what we do not know.
We do not know if it works at scale, yet, for instance. We do
not know what kind of speeds it will deliver once the network
is at capacity. These are some issues that have been in doubt.
So, there is some criticism toward the Commission to have
funded at such a large degree, $886 million for a technology
that has yet to be proven at scale and at capacity.
Senator Tester. OK. Do you want to add on to that, Mr.
Wilkins, at all?
Mr. Wilkins. Yes, I will just add one thing, which is, I
think it is interesting that, in some ways, it goes back to
this deployment versus access question, which is, you know, a
LEO network is actually, kind of, different from a deployment
standpoint than we are used to thinking about it. It is not
about building assets on the ground in a local area. Their
assets are in space. However, the, you know, the economics, I
understand it. There is sort of a somewhat high upfront cost to
afford the terminal, and such. And that is where a demand
subsidy, such as EBB, if that was permanent, for example, could
actually, probably, go a long way.
Senator Tester. OK. Thank you all. Thank you, Madam Chair.
The Chair. Thank you. Senator Cruz.
STATEMENT OF HON. TED CRUZ,
U.S. SENATOR FROM TEXAS
Senator Cruz. Thank you, Madam Chair. Welcome to each of
the witnesses. Thank you for being here. Each of you, in your
witness testimony, has touched on the importance of broadband
mapping and understanding exactly what parts of the country are
still unconnected. And I whole-heartedly agree with importance
of having the whole picture, so that we can make smart and
targeted investments.
To that point, when one tries to look at the facts and
figures, as to just how much money the Federal Government has
spent on expanding broadband infrastructure and increasing
connectivity, it can be maddening. It is almost impossible to
get a full and complete picture. There are so many different
programs, so many pots of money at so many different agencies,
all making different grants, providing different subsidies, and
it does not seem like there is one central authority keeping
track of, or even coordinating, everything.
Two questions, for each of the witnesses on the panel.
First of all, what is your best assessment of what we have
spent in the last decade focused on expanding broadband? And
second, would you agree that this disparate system of programs
is inefficient, and should there be one authority in charge of
tracking and coordinating all the Federal efforts? And,
Commissioner O'Rielly, why don't we start with you?
Mr. O'Rielly. I will start with your second question, and
the answer is, absolutely. I would argue the FCC is in the best
position to do so, but you have the right to pick somebody
else.
In terms of the amount of money, I would have--there is so
much money that has been added in the last 9 months, that if I
think that--you know, $5 billion, about average from the FCC
per year, $4.5 to $5 billion. There is money at USDA under the
ReConnect of $600 million, and that has been about a three-or
4-year program.
So, I would have to add everything up and try to figure out
how much money we are talking about. But to go to your earlier
point, I do not want to use your time, but we--I asked,
requested, a JAO study on the similar type of scenario for the
amount of money going to broadband for E-rate or schools and
libraries, at the time, many years ago. And JAO came back and
said, ``We cannot really do it. It is too complex a question.''
And that is what we are facing right now, with all of the money
coming in from different sources, and allowing the money to be
very flexible for, like, Department of Treasury. It can be for
so many different purposes including broadband. It is hard to
track where the money is going.
Senator Cruz. Professor Ali?
Dr. Ali. Thank you very much for your question. I am doing
some quick math here. Between then, let us say, $5 billion from
USF, and then, USDA offers $1.4 billion in grants and loans,
that has been over, let us say, since 2015, 2014. Plus, $7.2
billion in the Recovery Act money, you know, cannot even add
that quickly, but those are the numbers that I have come up
with, plus all of these other pockets. So, we have spent
billions of dollars and we are continuing to spend billions of
dollars to make these connections.
Senator Cruz. And is this the most efficient way to do
this?
Dr. Ali. I think that we know that this is a market
failure. We know that public money has to be spent in order to
connect the unconnected, as this is a policy priority. I do
not--I think, early attempts at funding did not go well. I
think handing money to the 10 largest telecommunications
companies in CAF and CAF II, for low requirements--low buildout
requirements, actually has put us in a position where a number
of communities are, kind of, living in a digital purgatory
where they have low-speed, but still high enough speed that
they are considered served. And now, they are stuck while the
rest of the country moves toward fast, high-speed fiber and 5G.
Senator Cruz. Mr. Wilkins, Mr. Forde?
Mr. Wilkins. Yes, Senator, thank you. I would just--I agree
with Commissioner O'Rielly and Dr. Ali's math on the current
numbers. I would just emphasize, this in some ways is the whole
idea behind that FCC analysis that came up with $80 billion in
the current proposal in the Accessible Internet Act.
You know, $80 billion is--if we invested in robust,
scalable networks, we could actually be done with this sort of,
ongoing, every year we spend more, and do not quite get closer.
The specific analysis was $80 billion would build out
everywhere, and then, you would have a very small remaining
number of homes, probably in places like Senator Sullivan's
Alaska, where you would need ongoing subsidy, but it would be a
lot lower than what it has been. So, that would just be point
1.
And second, quickly, on the map, Senator. I think it is
just important, just as your question indicates, the map should
not be thought of as a static, an atlas, right? It is not that
the Commission is going to say, ``OK, we are done. Here are the
maps.'' It is really a dynamic database of what is happening
with deployment. That is going to, by definition, need to be a
living, breathing, dynamic event and would hopefully help get
at some of the issues that you are raising.
Senator Cruz. Mr. Forde?
Mr. Forde. Could not agree more. As a smaller company, one
of the things that all these different Federal programs have is
they have different rules and qualifications. It takes a
tremendous amount of time and effort to even analyze whether or
not we can participate in them because of the regulatory
burdens that go along with that.
Having that all housed in one agency, such as the FCC,
would make it easier for us to get our data. They know us. They
know who we are. They know our capabilities and technical
stuff. We do not have to share all that, spend all that time
and effort analyzing these programs and figuring out whether or
not they can work for us and participate, and would make more
of them usable for us.
Obviously, an unbelievable amount of money spent on
broadband. Do not disagree with that. There is also a
tremendous amount of money going to operating expenses for
folks, who have a tough time running their network. We do not
need any money to operate our network and we could--you know,
so certainly, there are billions and billions of dollars out
there in USF funding, too, that is added to this, going to
people that need to operate their networks. So, I think
companies that have the ability to operate it, should also be
given some preference over those that do not, and do not need
any more ongoing funding to operate their network.
Senator Cruz. Thank you.
The Chair. Thank you, Senator. We now have Senator Sinema.
STATEMENT OF HON. KYRSTEN SINEMA,
U.S. SENATOR FROM ARIZONA
Senator Sinema. Thank you, Madam Chair, and thank you to
our witnesses for joining us today. My top priority in the last
year has been working with local, state, and Federal partners
to keep Arizonans healthy and safe from the pandemic. The
pandemic has put a spotlight on the digital divide in this
country, and I have supported efforts to expand broadband
access in rural and Tribal areas, where the digital divide is
widest, and ensure that Americans struggling economically can
remain connected as the recovery continues.
But broadband connectivity lets kids participate in
distance learning, allows veterans to have telehealth
appointments with their medical providers, and allows Arizonans
across the state schedule their vaccine appointments online.
And I am looking forward to working with my colleagues on this
committee, to develop bipartisan solutions to get Arizonans
connected, and to keep them connected. As we do that, we must
ensure that we have accurate data about broadband, that Federal
agencies are coordinating their efforts, and that Federal
resources are being used appropriately.
So, my first question is for Mr. Wilkins. Tribal lands and
rural areas have some of the lowest rates of broadband
connectivity in the country. And the most recent FCC Broadband
Development report stated that more than 20 percent of Native
Americans in rural Tribal lands, lack access to sufficient
broadband capabilities. I supported the FCC's Tribal
prioritized filing window for the 2.5 gigahertz band. And this
window provided tribes an opportunity to access spectrum
resources, to connect Tribal members. Many tribes in Arizona
received licenses, including the Gila River, Hopi, Tohono
O'odham, Havasupai, San Carlos Apache, and White Mountain
Apache.
But what are your thoughts on last year's Tribal priority
window and going forward, what approaches should Federal
agencies use, to help connect Tribal communities?
Mr. Wilkins. Yes, thank you, Senator. I strongly support,
essentially, programs to help Tribal communities make progress.
I mean, the equity issues are very big, and I would just say
that the economic issues around broadband are particularly
pronounced. Just to give you a specific example, in the context
of the RDOF auction, frankly, many of the geographic
definitions for how money was awarded, made it very hard to
actually pursue support in Tribal areas, essentially, because
the population can be so spread out, relative to the way the
funding is awarded. And that does make a wireless priority
window, like what you are describing. I actually have an
import, at least, you know, to go back to the previous
discussion, make sure there is some ability to get broadband
there.
So, the problems are very real in Tribal areas, and
especially around the economics of bringing in broadband. So, I
think they are very well designed.
Senator Sinema. Thank you. My next question is for
Professor Ali. In your written testimony, you discussed the
persistent problems with the maps the FCC uses to determine
which areas of the country have insufficient broadband. And, as
you know, inaccurate maps complicate efforts to send Federal
resources to the parts of rural Arizona that are not connected.
Along with bipartisan members of the Committee, I supported
the Broadband Data Act, which passed last year. And that law
now requires better, more accurate maps, but it has not been
fully implemented. So, what more needs to be done to ensure
that we have maps that we can rely on when making decisions
about billions of dollars of Federal investment?
Dr. Ali. Thank you very much for the question, Senator. I
absolutely agree that we need to fix the mapping before we
start spending even more money, because these maps need to
reflect those who actually do not have, who are un-and
underconnected.
I think we can look at some best practices from what some
states are doing. I am buoyed by what I am reading about in
Georgia, with this innovative partnership and I think these
are, kind of, the out of the box examples that we can take to
heart and learn from. But this also means bringing more
stakeholders to the table, not just providers but bringing
communities and counties and states to the table, as well, to
have that serious conversation.
Senator Sinema. Thank you. You know, my last question is
both for Professor Ali and for Mr. Wilkins. Many Federal
agencies put a role in expanding broadband access for
Americans, including the FCC and the Departments of Commerce,
Agriculture, and Treasury. And this, of course, we have heard
has caused confusion for applicants, especially when the
programs are inconsistent, or they occur concurrently.
So, I have supported better coordination between Federal
actors and the December Omnibus Bill that we passed required
increased coordination and a one-stop shop for applicants. So,
what are your thoughts on increased Federal coordination,
between the FCC and other Federal partners, to help get
Americans connected?
Mr. Wilkins. Senator, maybe, I will start, because I know
Dr. Ali knows a lot about the USDA side of this, as well. I
would just say, in a way, the problem you are describing it is
a critical one, but it actually comes from a good reason, which
is there are so many new kinds of providers interested in
bringing broadband to rural communities. And so, what you
actually see is, traditionally a telecom operator, a small one
or a big one, knows how to work the FCC, understands FCC
programs, maybe not the USDA so much. A local, rural provider,
an electric coop, was mentioned. They know all about working
with the USDA and the FCC can be very hard. And then, in
contrast, you know, a large company actually says to the USDA,
``Boy a lot of your requirements are things that do not quite
work for us, because we have all kinds of, you know, public
disclosures we do as a big company''.
So, it is different providers are used to working with
different agencies and, coordination that actually just
addresses that, making it much more of a smooth process for all
the different kinds of providers that want to bring broadband
to rural communities, that alone is a big reason to do, you
know, what you are describing. And it will make a difference,
going forward, if it is done well.
The Chair. Thank--go ahead, Dr.
Dr. Ali. I would just add, just really quickly, I
absolutely agree on the need for coordination and the idea for
one portal for all applicants. I also think that, in partner
with coordination, we need to actually have a designated leader
in this who should do the coordinating. I think we speak a lot
about that. But the next level should be who should organize
the coordination.
The Chair. Thank you. Thank you, Senator Sinema. Thank you.
Senator Moran.
STATEMENT OF HON. JERRY MORAN,
U.S. SENATOR FROM KANSAS
Senator Moran. Chairman Cantwell, thank you very much. Let
me begin with Commissioner O'Rielly. Commissioner O'Rielly,
thank you for your public service. My only complaint--perhaps
my only complaint, at least public one, during your service is
that you were not Kansan. Could not overcome that.
Let me start with you and asking you, the maps have always
been a topic of conversation that I have had with the FCC, you
and others. We passed, President Trump signed the Broadband
Data Act. The FCC is now required to collect granular shaped
files and propagation maps that depict provider service and
coverage areas. The concern then raised, or the explanation for
why that might not happen is lack of resources, dollars. We
have appropriated $98 million in the Consolidated Appropriation
Act. Are there any excuses left to get us to the point in which
we know what areas are underserved?
Mr. O'Rielly. Well, I do not think there are any legitimate
reasons, but I would only say that--and I said this to Ranking
Member Wicker, is that you have added new burdens on the
Commission. Two new programs, one, you know, basically new E-
rate program, and the EBB. That is really time--that takes an
awful lot of effort. And so, you are diverting resources, not
because you cannot have people working on two different
projects, but they all have to go through, you know, common
reviewers, and there are only so many people at the top that
have to look at everything. So, that was my point----
Senator Moran. So, it is volume of work.
Mr. O'Rielly. It is volume, but it is also a factor, to
Senator Wicker's point, you know, was that--my point to him
was, make this very clear. This is one of your top two, three
priorities, and it has been. I have been very aware and in
support of your point for when I was there.
Senator Moran. No, you have, and I appreciate that. I mean,
it is--it needs to be a priority because it determines what we
do next.
Mr. O'Rielly. Yes.
Senator Moran. It would be irresponsible for us to
authorize the spending of more money, the FCC to create more
programs, and put it in the wrong place. The maps, then, in my
view, determine the direction we go, and we should not go there
until we have a map.
Mr. O'Rielly. Which is somewhat troubling, I would think,
to compliment. We have these other Federal programs that--what
are they using? They are not using maps. If our maps--or, if
the FCC's maps are flawed, they do not even use any. That is a
problem.
Senator Moran. Now you have stuck something else in my
brain to worry about, which we will. Mr. Forde, Midco was named
as one of the winning RDOF bidders in the reverse auction. That
program is funded by the Universal Service Fund. Tell me about
what concerns you have about the Universal Service Fund and its
future?
Mr. Forde. Well, I think, obviously, the Universal Service
Fund, you know, again, if that funding is going out to provide
broadband, then it should be going out to, as I just touched
on, you know, to truly folks that are unserved. In our
footprint, in the area that we serve, about $1.3 billion of
that just went out to other providers for operating expenses.
Again, we do not need that operating expenses and many of those
providers are overbuilding areas that already have Gig service.
So, certainly to make sure that that funding does not continue
to go to folks that need it to operate, would be helpful, as we
look at USF reform, and again, only goes to targeted folks that
are truly unserved.
Also, just wanted to note, it is a pleasure to work with
you and be in Kansas. Thanks to your efforts, in addition to
Senator Hoven and Senator Thune, working with the USDA's
ReConnect Program, for the first time.--we usually found out
about ReConnect grants, when they were awarded, but for the
first time, this year, thanks to your work, we got a response
and actually, some of our--and they held a challenge process to
make sure that our areas, where we had been awarded CAF II
funding, was not overbuilt by ReConnect. So, I just wanted to
thank you for your work with USDA to make sure that we actually
got a response to our challenges, for the first time ever, and
that they were upheld. So, really appreciate your work to make
sure that USDA's programs are working better and truly
targeting unserved areas.
Senator Moran. Thank you very much. Maybe I should ask you
about what Commissioner O'Rielly said. Where does the map come
from for the USDA to utilize? What information are they using
to make that determination? And I also was going to give you--I
thought I might get you to respond about the concern about the
declining amount of dollars within the fund--within USF?
Mr. Forde. Yes, again, I think that you know, the USDA,
some of the information that they have had has been a couple
years behind, as the ones actually out there and been deployed,
and that has been problematic, from that effort. A lot of those
grants need to, again, truly be focused on unserved areas. They
also--that process has been very difficult to apply for.
Companies have been limited, based on their structure. So, like
us, it has not worked well for us, based upon our company's
structure. It is targeted to more old, rural cooperatives and
companies like that, which makes it problematic for us to apply
for. So, appreciate your continued efforts to work on that
issue, so----
And in regard to the--go ahead. Sorry, Senator.
Senator Moran. I am running out of time. I would conclude.
I always want Chairman Cantwell to like me, so I am going to
try to conclude in 2 seconds.
Mr. Forde. Go ahead.
Senator Moran. I would say thank you for your presence in
Kansas. I also would highlight, and I do not have a chance to
ask--time to ask the question, but we really need to have
oversight on those RDOF winning bidders, and whether they are
actually providing the service that they have committed to
providing. Oversight seems hugely important to me and, again,
maps are one thing, if we provide it the wrong place, but if we
give money to somebody and they do not actually fulfill their
commitment, that is another very damning circumstance. Thank
you.
The Chair. Thank you, Senator Moran. Very important point
in this whole debate. I am going to run and vote and ask
Senator Lujan to take over. I think he has already voted. So, I
know that we have several other members who would like to ask
questions. I know the Ranking Member was hoping to get in a
second round of questioning. So, we are going to try to keep
this going. We hope our witnesses can stick with us for a
little bit longer. But, Senator Lujan, thank you for taking
over. It is your turn to ask questions, and thank you for
chairing while I am over running to vote.
STATEMENT OF HON. BEN RAY LUJAN,
U.S. SENATOR FROM NEW MEXICO
Senator Lujan. Thank you so much, Chair Cantwell. To the
witnesses, thank you so much for being here today. To our Chair
and Ranking Member, thank you for calling this important
hearing, and the full committee. An important conversation that
we have to have across America, as we talk about expanding
broadband infrastructure and, what I hope is a goal for all of
us, to get to 100 percent connectivity of fast, affordable
Internet in America.
Recently, Kimble Sekaquaptewa, who is the Chief Technology
Officer at Santa Fe Indian School, and a member of the New
Mexico Homework Gap Team, shared a story with me. Back in
August in New Mexico, when it is still very hot, in one
particular Pueblo community, the school was delivering 100
percent distance learning, as in most parts of America. And we
know that a lot of homes still lack access to fast internet, or
any Internet at all. And there was a student that was in middle
school, in junior high, trying to do his best. He was trying to
get the homework done, which meant sitting out in the sun all
day to connect to Wi-Fi. He was there so long he got
heatstroke, trying to complete his assignments.
The American Rescue Plan's temporary E-rate support for Wi-
Fi hotspots and connected devices is an important stopgap,
however, I believe that Congress must mobilize to advance long-
term solutions that bring resilient, redundant, and secure
broadband into every home. And over the past year, the Federal
Government has provided $16.7 billion for broadband buildout.
Dr. Ali, is $16.7 billion enough to connect every American to
resilient, reliable, and secure high-speed internet, yes or no?
Dr. Ali. No.
Senator Lujan. Last Congress I worked with Whip Clyburn to
author and pass the Accessible, Affordable Internet for All Act
in the House, and was excited to co-sponsor this legislation
when Senator Klobuchar reintroduced it here in the Senate. The
bill would commit more than $80 billion to build high-speed
broadband infrastructure in unserved and underserved
communities, to close the digital divide and connect America.
This question is for Mr. Wilkins and for Dr. Ali. Mr.
Wilkins, do you agree that $80 billion is the right ballpark to
connect all Americans, yes or no?
Mr. Wilkins. Yes.
Senator Lujan. Dr. Ali?
Dr. Ali. Yes.
Senator Lujan. Now, with that being said, it is my
understanding that that is based on a per capita formula, as
opposed to looking at people in an area. Is that correct?
Mr. Wilkins. Senator, that is essentially just the overall
national number and local conditions can be very different,
depending on what is happening there.
Senator Lujan. Should local conditions be looked at when we
are making plans to build out?
Mr. Wilkins. Absolutely, and states and Tribal governments
have a huge contribution to make.
Senator Lujan. The Accessible, Affordable Internet for All
Act also includes legislation I authored, which is the
Broadband Infrastructure Finance and Innovation Act, to provide
$5 billion in Federal funding to make low interest financing
available to communities, to support broadband development. Mr.
Wilkins, how can financing help leverage Federal dollars to go
further, to provide more Americans and New Mexicans with access
to resilient, affordable high-speed internet?
Mr. Wilkins. Senator, it is critically important. I think,
as Dr. Ali mentioned, one of the important trends is smaller,
local providers actually looking to bring broadband. Those
companies need help with financing. If you are a big, public
company, you can raise the necessary capital. Smaller ones, if
they can, it is very expensive, and it means they spend more in
financing than they do on building broadband.
So, I think that it is a very real problem. I think that
the simple math of a Federal loan guarantee, such as you are
proposing in the BIFIA proposal, would do huge good for a lot
of those capital raising efforts.
Senator Lujan. Every year Congress hears promises about
next generation technology and the ability to connect to
everyone. First, it was 3G, then, 4G LTE, now 5G and low Earth
orbit satellites. Now, do not get me wrong. These are amazing
and important technologies. I have always believed that there
should be canopies and layers associated with how we can
achieve 100 percent connectivity in America, to power increased
speeds and to connect the unconnected. Whether we are talking
about geographical challenges, topography, where we have
mountain ranges that we need to address, and especially in
rural and Tribal communities, where easement constraints need
to be addressed.
Now, the problems arise when these services are the only
option available in a community. I believe we have to plan for
a future where broadband is redundant, resilient, and secure.
You are going to keep hearing me say that. I think that is what
we need to get to in America.
So, I want to ask each of you a yes or no question. The FCC
currently defines broadband as 25 megabits per second download,
which is what the measure of speed is where people get all the
incoming, if you will. If you are pulling content into you,
that is the speed the FCC prescribes. And 3 megabits per second
upload. So, if you are interfacing with the outside world, and
now, with the use of Zoom, people are talking to more people
using video and things of that nature. So, now we are talking
about 3 up. There is a lot more use of connecting with people
outside, as opposed to just getting the incoming. So, my
question is, does the FCC's current definition of broadband
meet current needs for a single household. Mr. O'Rielly, yes or
no?
Mr. O'Rielly. My apologies for--I would say it does a very
good job. Is it complete? Probably not, but in terms of your
point in the Zoom, 3 does an--you know, you can have multiple
Zoom conversations. And I have seen that the most they have
gotten is 5 megabits going up. The idea that it needs to go to
100, I disagree with.
Senator Lujan. Is 25/3 enough to meet the current needs for
a single household?
Mr. O'Rielly. You know, that is something for policymakers
to consider changing. There are multiple reasons not to do so.
Could it be improved? Yes. Yes, I think it is sufficient
compared to those that have nothing, yes.
Senator Lujan. Mr. O'Rielly, do you have Internet at home?
Mr. O'Rielly. I do.
Senator Lujan. What speeds do you have?
Mr. O'Rielly. I have Verizon Fios and we probably have 150.
Senator Lujan. 150?
Mr. O'Rielly. Megs for download.
Senator Lujan. And up?
Mr. O'Rielly. It changes depending on, you know, how my Wi-
Fi system is working.
Senator Lujan. Is it higher than 3?
Mr. O'Rielly. It probably is higher than 3, but I have not
done a test in quite a while.
Senator Lujan. My point is, those speeds that you are
talking about, are the speeds that are being prescribed with
100 down and 100 up. I want everyone to have what you have.
Mr. O'Rielly. But I am saying 100 up is--we have had this
conversation most of this day. It blows through every program
that has been out there, and it is to a point that we--that is
far beyond usage expected in the decade.
Senator Lujan. Far beyond usage. So, why would you pay for
that?
Mr. O'Rielly. Well, I do not pay--I do not pay--I said----
Senator Lujan. You subscribe to get--you do not get it for
free, do you?
Mr. O'Rielly. No, I subscribe to it.
Senator Lujan. Yes.
Mr. O'Rielly. My wife pays for it. But----
Senator Lujan. Yes, you get what I am saying.
Mr. O'Rielly. Yes, I do.
Senator Lujan. You went for that package because those are
speeds that you believe, you need to be able to connect. And
all that I am asking here is, you know, what is acceptable. I
would love to chat with you more. Like, Mr. Tester, I respect
your work very much. I did not always agree, as you know, but I
definitely respect the work that you have done. So, I look
forward to chatting more with you there.
Mr. O'Rielly. Sure.
Senator Lujan. Mr. Forde?
Mr. Forde. Absolutely. I get 25/3 at my house. Three kids
doing online distance learning, my wife is running a very large
small business, I have been working from remotely. I receive my
Internet from a high-speed fixed 5G fixed wireless connection
from a tower 8.8 miles away from my house. Looks very similar
to the screen behind me. Had absolutely no issues through the
pandemic, through blizzards, all of those things. It has been a
great connection. And I would like to remind, with that
connection, that is not the ceiling. I can certainly purchase
more if I want to, to receive higher speeds and higher
internet.
So, certainly more than sufficient for our family and it is
also very, very affordable price of less than $50 a month. So,
been a great tool for us to have throughout the pandemic, as
well as my friends and neighbors who are all ranchers. A guy
just ran a bull auction nationwide, people buying cattle from
all over the country with the same speed and connectivity, so--
--
Senator Lujan. So, Mr. Forde----
Mr. Forde. Very much so. It works in rural America.
Senator Lujan. I will assume your answer is yes.
Mr. Forde. Yes.
Senator Lujan. Dr. Ali, yes or no?
Dr. Ali. No, I do not believe that it is satisfactory.
Senator Lujan. Mr. Wilkins?
Mr. Wilkins. No.
Senator Lujan. Very much, appreciate that. The last
question I have, as I am going to go to Senator Blackburn, is,
Mr. Wilkins, how might have the overbuilding provisions and
RDOF raised the cost of broadband in the long-term, or
otherwise hinder the goal of closing the digital divide?
Mr. Wilkins. Well, as I sort of commented in my testimony,
I think overbuilding, in some ways, is the wrong way to think
about the question of bringing broadband to an area that does
not meet the standard that Congress says is necessary. And I
think that a lot of the approaches used in RDOF, that really
did--and many of the implementation details, frankly, made it
pretty hard for a true new provider that was going to offer a
much better service, to be able to bid effectively. And again,
the question is not overbuilding, not overbuilding. The
question is what is the performance level that we think is
necessary in these rural areas?
Senator Lujan. Appreciate that, sir. I would now like to
recognize Senator Blackburn for her questions.
STATEMENT OF HON. MARSHA BLACKBURN,
U.S. SENATOR FROM TENNESSEE
Senator Blackburn. Thank you so much, Mr. Chairman. And I
am trying to get to the floor to vote. I do have a couple of
questions that I wanted to bring up and let us start right
there.
Mr. O'Rielly, let me come to you, and it is good to see you
again. Talking about this 100/100, the symmetrical networks,
talk about the impact that would have at the Commission. If we
keep moving the goalpost, and say we are not going to deem an
area as served, unless it meets this standard. So, just a
couple of comments on that.
Mr. O'Rielly. Sure, so it terms of 100/100 speed that has
been talked about, the demand for the upload is far beyond
where the current Commission standards are and would wipe out
almost all of the areas in the United States. The majority of
the United States would be deemed unserved and, therefore, you
have recalibrate all the different programs. They would pretty
much be wiped out and all those dollars would be gone, and that
is why people talked about new spending.
I say there is a second purpose, though, because it
triggers the section 706, which I know you are familiar with,
in terms of the regulatory burdens the Commission can impose to
remedy that situation. That is one of the other problems with
the speed threshold here.
Senator Blackburn. OK, let me ask you, just a point of
clarification there, would it deem it unserved or underserved,
for all these other areas?
Mr. O'Rielly. Right. It would depend on what the structure
of the bill or law turned out to be.
Senator Blackburn. OK.
Mr. O'Rielly. But would likely be unserved, under that
definition.
Senator Blackburn. OK. All right. Thank you, thank you for
that. Mr. Forde, you have talked some about what you have and
how you have run businesses. Your neighbors that are ranchers.
What percentage of your network usage, that you have talked
about today, does downstream and upstream usage represent?
Would you just ballpark that for us?
Mr. Forde. Certainly. Again, we use, you know, three forms
of technology to deliver broadband--the direct fiber
connections, the hybrid fiber-cable mix, and the fixed wireless
network. Throughout the pandemic, it has always been about 14
to 16 percent higher download speeds than uploads, so--and that
has not, you know, varied regardless of the technology used to
deploy. So, you know, we will continue to use whatever tool is
best for those folks, and we will provide whatever connectivity
they need regarding all three of those.
Senator Blackburn. OK, so an asymmetrical network works for
you, correct?
Mr. Forde. Correct, and that is what our customers are
using and that is what our customers are asking for, and all
three of those technologies are scalable. We would not deliver
those to our friends and neighbors if we would not be able to
scale those, both upload and download, based upon customers'
needs and usage, so----
Senator Blackburn. OK.
Mr. Forde. Keeping in mind that they are all scalable to
more, should our customers like them.
Senator Blackburn. All right. And that is helpful to get. I
think that is important. Meeting the needs, so that we get more
people into served areas and out of unserved areas, and with
the pandemic, whether it is access to healthcare, economic
development, law enforcement, or education, the Internet has
become an imperative for these communities.
Let us see. Mr. Wilkins, I wanted to ask you about
maximizing the use of Federal dollars to reach these unserved
areas, that really have been overlooked, because of the
significant expenditures of getting into those areas where you
have so few customers on a mile, and they are with the fiber.
So, how would you maximize those dollars? Would you approach
it, as Mr. Forde has done, with a combination of delivery
systems?
Mr. Wilkins. Yes, well--so, I think it is first just to
start with what is the investment Congress wants to make and
what are the standards to set. I think it is, obviously, true
that the less density you have in an area, for example, the
harder it is to bring a certain quality of service.
So, I think the first question is, what is the size of the
investment? If there are areas where fiber actually does not
work within the budget that is available, certainly other
technologies, you know, are very viable. And I think, actually,
Senator Cantwell mentioned, you know, the idea that you might
have separate portions of a program focus specifically at
extremely unserved areas. I mean, Senator Sullivan talks about
Alaska. Those are very good ideas. They have existed in the
past. They could be done better, I am sure. But to me, that is
an implementation detail, after the question of what is----
Senator Blackburn. Well, and yes, I think finding something
that works in the area, and not necessarily fiber to the
premise, which was the old way of approach, is something that
is an imperative for us to consider.
I will--I am at the end of my time. I will just say, you
know, Mr. O'Rielly, I cannot believe we are still discussing
maps. When I was in the House and we were working on this
issue, cleaning up those 477 maps was a priority, and we could
not get the Senate to work with us on that as a priority. So,
hopefully now, we are going to actually see something done
about the mapping and, also, closer attention paid to oversight
of expended dollars to fight waste, fraud, and abuse. Be sure
this money is being used to get people online.
Thank you, Mr. Chairman.
The Chair. Thank you, Senator Blackburn. And definitely we
are going to get somewhere on mapping. Trust me.
OK, I think we may have Senator Rosen on our side. If not--
is Senator Rosen--OK. If not, Senator Capito.
STATEMENT OF HON. SHELLEY MOORE CAPITO,
U.S. SENATOR FROM WEST VIRGINIA
Senator Capito. Thank you, Madam Chair, and thank all the
witnesses and this is an extremely important, obviously, issue
to all of us, particularly in a state like West Virginia, which
I know you all are aware of.
Let me ask you, something that Senator Klobuchar and I are
working on a bill that I formulated as an idea that I saw from
one of my very small Doddridge County, who decided that they
were going to deploy, as a county, deploy broadband to
everybody in the county. We are talking very rural here, and
small. And I thought it was brilliant the way they decided who
they were going to go to first. They are going to go to the
students. Every student in that county will be connected
through the efforts of the Board of the ReConnect Program of
Internet service provider, City Net, and as the County
Commission. And so, it is an all-hands-on-deck proposition.
So, help me--in the bill, we do incorporate some
suggestions for E-rate. In other words, reclassifying the home
as a classroom. So, I would like to ask Mr. Wilkins what you
think of that idea, and how do we achieve that? Because it is a
classroom now, for so, so many of our students and families.
Mr. Wilkins. Yes, so, Senator, that is a great question. I
literally worked on a business plan like that for an RDOF
participant, actually a municipal sort of entity, that wanted
to do exactly what you are describing, in a different state.
And that question of, we are not sure that all the families in
this rural area actually can afford the service, at the level
we want to provide it, and we actually talked a lot about E-
rate, what might be available. And this was last year, and so,
the discussion of, well, you know, classroom does not include
the homes. Very real issue and, absolutely, if that was done,
would actually improve the deployment cases in a lot of areas.
Senator Capito. Because of the affordability issue that E-
rate would bring to those families? Is that the correct
assumption?
Mr. Wilkins. Yes, so, I mean, in other words, if you are
going to build a very high-performance broadband, you know, you
might need to charge $75-80 a month. I mean, that is a very
reasonable rate for high-speed broadband. And you know, there
are many families, including in rural areas, where that
actually might be too expensive. And so, as sort of a partial
support, in the form of E-rate, it is sort of done through the
school process for students, can be a great demand support, I
guess is how a project finance person would think about it. But
would have a very big impact in many areas.
Senator Capito. Thank you. Yes, that is something that we
are pursuing, and we are going to move forward on that. Mr.
O'Rielly, let me ask you a question on the RDOF procedure. We
were able to get some local providers to add--I think we got a
pretty robust response. The FCC came back with a fairly decent,
large award that is going to be able to serve our state in that
auction.
Here is my deal. There are people--and I have written--I
wrote to the FCC and you know what I am talking about. There
are people who were awarded census blocks in that--there are
entities that were awarded census blocks in that auction, that
have not performed in the past. And I want to know from you
what kind of teeth do we have in that RDOF? What kind of teeth
should we put into that, in terms of claw back, or whatever,
where we can make sure that we are actually getting what the
proposed delivery is supposed to be?
Mr. O'Rielly. Well, the FCC is, my understanding, is going
through long form process right now, which means they are
scrubbing the winning bidders for all of the detail, and
requiring, you know, filing of numerous documents. And Mr.
Forde can probably comment about how much material that they
seek. So, they are going through that process to make sure that
those can--you know, and probably will, you know, do a really
good job, especially given the added pressure and focus by
members and else wise. So, I expect that they will do a very
good job.
What I have suggested earlier, and something I did not--was
not successful in adding to the program and it should have been
something that we can do going forward, is to really bump up
the penalties for missing the deadlines. Right now, I think it
is, you know, $3,000 per violation and 15 percent of your
funds. Well, some companies may be willing to do that for a
couple years, and then, take the penalty. That is not
acceptable in my mind, and we really could have--I did not win
that argument, at the time, and I did not win a bunch of
things. But that would be something that could improve the
situation.
Senator Capito. Well, I agree with you. It is totally
unacceptable. It is unacceptable that anybody could take the
dollars, move forward, in less than judicious fashion, and make
a decision four or 5 years later, when the service has not been
delivered, well, I will just go ahead and pay the fine.
I mean, we have got to be better than this. I mean, we have
seen this in the last--in some of these other programs where,
at the end of the day, here we are still talking about the same
thing, three and 4 years later.
So, I really want to see some teeth in this. I am hoping,
in the second--as they are looking at the long form, that they
really are looking at past behavior, looking at people who do
not deliver the service they say they are going to deliver
right now, today, and that they do not allow those contracts to
go forward. Because, in the end, they are not going to do it. I
mean, you know, what is it? Past performance indicates, you
know, future behavior. And I do not know why that is good
enough in every other rule but not in this case. It is very--
you can tell, it is very frustrating for me.
I do not know, Madam Chair, am I over my time?
The Chair. Well, just by 11 seconds. That is OK.
Senator Capito. Well, that is good. Thank you very much.
The Chair. Thank you. Thank you, Senator Capito. You raise
some very important issues. Senator Young.
STATEMENT OF HON. TODD YOUNG,
U.S. SENATOR FROM INDIANA
Senator Young. Thank you, Madam Chair. Commissioner
O'Rielly, last year, when you testified before this committee,
we discussed your support for removing unnecessary barriers and
maximizing competition in the Universal Service Fund auctions.
So, as we sit here, almost a year later, one of the lessons
learned from the first round of the FCC's Rural Digital
Opportunity Fund auction, is that broad participation by
providers means more consumers will be served with far less
funding.
As the FCC plans for the second round, and other programs,
what steps can the Commission take to expand bidding by
qualified providers, in order to extend broadband in rural
Indiana and across other states and narrow the digital divide
across the country.
Mr. O'Rielly. Well, one thing we can do, and I talked about
it in my testimony is, remove the ETC designation, or certainly
revamp it, because that is a barrier that companies are running
up against, in terms of the requirement to obtain it. And you
saw this in RDOF round one, where a number of providers that
people thought may bid, decided not to for that very reason.
Where they were going edge out into a new state, and therefore,
require new designation. They just were not willing to do so,
and so, that is a problem.
And you see where the Committee, and others, have done, you
know, have fixed this. In the Emergency Broadband Benefits
Program, there is basically an exemption for this purpose. So,
it cannot be something that held the test of time if it is
something that the Committee is willing to waive. So, I think
that is something enormously helpful that can be fixed
immediately.
Senator Young. Very good. I may have some follow-up
questions, but I will submit those in written form, that you
can provide to me later.
I am going to turn to 5G, we will call it, nationalization.
The topic of this hearing is the deployment of broadband, and
there are a lot of ingredients that go into making broadband
available beyond Federal funding, including spectrum. Mr.
Wilkins, as former Chief of the Wireless Bureau at the FCC, I
think it is fair to say you have a good level of familiarity
with spectrum policy. Are you familiar with proposals to allow
DOD to either build out a national network for 5G, or let a
private third-party network operator do the same? And I will
say, I am curious if you have any thoughts about this kind of
model being pushed by some companies, seeing that it has never
been done here in the United States.
Mr. Wilkins. Yes, yes, Senator, I am very familiar with it.
I honestly find it a very perplexing proposal. Just a couple
observations. The general idea of sort of government
facilitated, government sponsored or run wholesale networks,
has actually not worked anywhere in the world that I am
familiar with. Going back 20 years to Australia for the fixed
side, recently Mexico on the wireless side, I have not seen it
work.
The specific proposal, as I understand it, involves up to
350 megahertz of DOD spectrum. That is actually more spectrum
than any of the wireless carriers have today. You know, you
have AT&T, Verizon, and T-Mobile with, frankly, less spectrum
than that in total, supporting 100 million or more customers in
all kinds of uses. And I just had not understood, actually,
what the use is supposed to be for DOD to need that much
spectrum, in that much of the country. And I think there are
other details that also do not make sense, but I think at that
simple, logical level, I just find it very perplexing.
Senator Young. OK. Commissioner O'Rielly, I really want to
ask you a question on an unrelated topic, but I would like to
get your thoughts on that, if you can give me 30 seconds or
less. In agreement, in disagreement, what reflections do you
have on that topic?
Mr. O'Rielly. I agree, actually, with Mr. Wilkins and I
completely oppose the idea of a wholesale network where we
would lease off spectrum to DOD or use DOD spectrum that they
themselves would build the network or allow someone else to
use. I think it is awful policy and it would contradict
decisions that have been made by this committee, and the FCC,
over the last many years. It should not be done, in my opinion.
Senator Young. OK. So, if I can reinterpret what all of you
said, you think it is a really bad idea.
Mr. O'Rielly. Yes, sir.
Senator Young. OK. Commission O'Rielly, with so many
Federal agencies and states in the process of awarding
broadband funding, it seems like there is a high risk of
duplicating efforts, and also, overbuilding private investment.
So, I would love to be disabused of this, but with these
constellations of funding programs and so forth, I am curious.
Do you agree that using a challenge process to get the most up-
to-date information on broadband availability can help reduce
this risk of overbuilding?
Mr. O'Rielly. Oh, absolutely, and it is not just a risk. It
actually exists. Mr. Forde, talked about the situation he
faced, I think, in Minnesota. I have seen the situation in
Wyoming, that I wrote about when I was still at the Commission.
So, the dollars are going to places that are already being
served. So, you are having a subsidized competitor entering and
competing against a private sector provider. It is really
problematic, and we are going to see more of it as we have all
these different pots of money competing against each other.
Senator Young. I thank our panelists. Madam Chair.
The Chair. Thank you. Senator Lummis.
STATEMENT OF HON. CYNTHIA LUMMIS,
U.S. SENATOR FROM WYOMING
Senator Lummis. Well, thank you, Madam Chairman, and thank
you, Commissioner O'Rielly for teeing me up. That is exactly
the problem. Sixty-five percent of rural households do not have
access to high-speed internet, and I am talking about the kind
needed to work or learn from home. So, the share of rural
households without access to high-speed Internet is 20 times
that of urban households.
And talk about identifying a barrier, our past Governor,
Governor Mead, engaged in a process called Endow, where he
identified barriers to economic growth and diversification in
Wyoming, and rural broadband, air service, and healthcare were
the top three and rural broadband was number one. And then, it
became even more exacerbated during the COVID crisis, because
you had all of these people trying to become educated and
working at home, in a state that has inadequate broadband
services.
So, thank you, Commissioner O'Rielly for teeing up my
question. You worked extensively to coordinate investment in
broadband during your time at the FCC, so you are familiar with
the problems overbuild poses to rural and hard to reach areas.
What do you envision is the best way to counter overbuild? And
excuse me if you have already addressed that.
Mr. O'Rielly. Well, I have a little bit, but I mean, there
are many things that need to be done, but one is, you know, we
need to know all the dollars that are going out and we need to
have coordination. But it is more than coordination, because I
have sat down with USDA in the past, and we talked about the
different--they did not, at the time, understand what I was
even talking about, in terms of subsidized overbuilding. That
is a problem. When two agencies do not have the same
commonality of a concept, and we never got that far.
So, we never got any resolution to that. It was punted to
somebody else and dealt with it and it has not been resolved.
Ninety percent of the funds from USDA can go to a non-
overbuilding purpose, but 10 percent can be overbuilding. That
is problematic in my viewpoint. But it is separate from the
decision the CARES money went to, in Tongue River's situation,
who, you know, was facing, you know, multiple providers. They
had a challenge process that did not work effectively, and they
did not have one in the state process, and the State's argument
was, we had to get the dollars out, as soon as possible, to
make sure we, you know, could receive funding.
So, there are a lot of things that could be done just to
rectify that situation going forward.
Senator Lummis. Thank you very much, and Madam Chair,
thanks for doing this hearing. This is really a critical issue
in my state. Now, I know this question has come up several
times during the hearing, but I have to point out that in
Wyoming many communities, many communities--many do not even
have 25/3 service. So, I am concerned when I hear about
proposals to open up Federal funding for areas that do not have
100/100.
So, my question for Mr. Forde, do you think we should
prioritize communities that still do not have even basic
broadband, before upgrading speeds?
Mr. Forde. Absolutely 100 percent agree. We have got to
focus on those truly unserved areas left. We serve many of the
neighboring states to you. So, we have got to get focused like
a laser on those and get them broadband once and for all.
Senator Lummis. Thanks. Commissioner O'Rielly, do you want
to weigh in on that?
Mr. O'Rielly. Absolutely agree with Mr. Forde, it should be
the priority of the Commission, and it certainly should be
reflected in the different programs that are created, that we
address and have a laser focus on the unserved population.
Whatever that number is, it could be---you know, we could
dispute on how big it is, on different measurements, but that
should be the priority of those, that have nothing. Those that
Senator Sullivan talked about, and others have talked about,
that have substandard broadband today, we should address and
that should be the primary focus, in my opinion.
Senator Lummis. Well, thank you both. That is music to my
ears. Now, I can tell you, one of the major sources of red
tape, holding telecom companies back from providing service in
rural America, is the Federal permitting process. It holds both
service in rural areas and Tribal governments.
So, Mr. Forde, could you talk a little about the impact of
Federal permitting processes, such as NEPA, in building out
your network?
Mr. Forde. Yes, we have a--obviously, in western North
Dakota, very, you know, close to Wyoming there, we have had
several issues. Took us almost a year to cross the Missouri
River, due to needing multiple permits from the Army Corps and
others, to deliver a new fiber pipe to some areas. Oh, and a
booming energy economy we have in western North Dakota, where a
lot of folks needed better connectivity out there, as we grew
to be one of the top oil producing states, delayed broadband
getting out there over a year. Similarly, crossing some Federal
lands in that area also delayed that process.
In the Black Hills, when Senator Thune was here with us
earlier, again, next to Wyoming, numerous issues in getting
service out there because of some of the Federal designations.
Not being able to--for example, there was a road going up a
canyon. There was no right of way for the road because the road
was built on Federal lands. So, there was really no place for
us to run the broadband, and hence, people up the canyon, no
broadband.
Senator Lummis. You are identifying the issues that are
holding Wyoming back, and I am very grateful for your testimony
today. And thank you again, Madam Chairman, for holding this
hearing. It is just critical to my State of Wyoming. Madam
Chair, I yield back.
The Chair. Thank you, thank you. It is so critical to lots
of aspects of the United States. I think we are going to have
Senator Rosen online in a few minutes, but while we are waiting
for her, I think I will just jump in here on a few points from
earlier.
Mr. O'Reilly, one of the issues that was brought up was
just satellite services, and obviously, you were an advocate
for that, at the FCC, I think.
Mr. O'Rielly. Well, I did not want it excluded from the
front part. I thought they had the right to be able to prove
that their technology should be considered. And what our draft
rules at the time would say, ``No, we are not even going to
consider it. They are excluded.'' And I thought it was only
right that they be able to prove--they, supposedly, and I was
not part of the--I was not brought into the process. They,
supposedly, were able to prove that to the staff and then, were
able to--on particular proprietor was able to bid in the RDOF
and receive funding.
The Chair. What do you think about that as an application
for whatever you want to call it--the 2 percent, the some
percent of America? I loved hearing from Mr. Forde today
because, you know, in a lot of ways, the central part of
Washington might be a little bit like that, but certainly not
the far east into Palouse, and certainly not out on the Olympic
Peninsula. We have mountains, we have forests, we have all
sorts of problems. But, so what do you think about satellite--
--
Mr. O'Rielly. Well, I have been in----
The Chair.--for a solution to very hard to serve areas?
Mr. O'Rielly. I have been impressed with what the plans
have been by a number of the lower satellite offerings. I have
experienced Starlink. I went--it took 3 minutes to set up, in a
rooftop in DC, and the service is 150 meg, instantly. So, I was
impressed by that.
Now, to the point Mr. Ali--or, Dr. Ali has made, we do not
know about the scalability. We also do not know if the business
model will work, and then, you have costs in terms of the
equipment. But in terms of, you know, filling a need of those
that have absolutely nothing, and they call it, you know,
basically, best of what you can get, kind of thing. I think
that is very impressive and it will only increase over time.
Who is going to succeed? I do not know. There are three or
four or five different satellite providers. Everyone thinks
there is room for probably two, but they will always say it is
me and this other guy, and they will all disagree on who that
is.
The Chair. Right, I hear you on that one. So, to me, this
issue about competition is an important one, because we
obviously want to have competition, because competition does
drive down cost. I mean, a lot of people would say, even within
the urban environment, we do not have enough competition. That
is one of the reasons why we have such high prices for
broadband, overall. And then, there is the issue of where the
market just is not working at all--market failure, as Dr. Ali
has mentioned. And so, Dr. Ali, I wondered if you could focus a
little bit on that, on the market failure side. I mean, to me,
when you put in the Universal Service Fund, when you put in
spectrum that was given previously, not the most recent ones,
but you know, you have a lot that we have invested in already.
So, how do we get efficiencies here? How do we get
efficiencies?
Dr. Ali. That is a great question, Senator, and Madam
Chair, thank you. How do we get efficiencies when it comes to
serving, or getting service to, the most unconnected? You know,
one of the things I am thinking about, is in my home State of
Virginia I have talked to a number of counties and they are
excited. They actually won--they have a little bit of money.
They are struggling to find a provider--a dance partner, as it
were, and even though they have got these incentives in place.
Something that is near and dear to my own heart is, you
know, opening up opportunities for municipalities and counties
to fund networks and organize networks themselves, in the form
of municipal broadband. I think that that has proven to be a
really interesting component, if we think about layering the
different types of providers. So, I would love to see the
regulatory barriers, in so many states, toward municipal
broadband and county broadband be eliminated to allow counties
and municipalities to drive their own future.
The Chair. And how would that help with the other aspect of
the dilemma where we have, you know, basically given green
lights, or we have had broadband deployment, only to have it
reach a community, but basically have the cost--you know, you
have no takers because the cost is so high? What do we do in
that case?
Dr. Ali. Another great question. I would love to see a
mandate where all providers have to have a low-cost option. I
believe that Jon Sallett had said that $10 a month is what the,
you know, lowest earning household can afford. Especially if we
are thinking about making the Emergency Broadband Benefit
Package permanent, maybe, at $50 a month, we need to make sure
that there are plans, that there are tiers available that that
can cover. So, I think that next step will be about pricing and
making sure that those who are using these programs can
actually afford services.
The Chair. Well, I think this becomes even more complex
with the world of, you had called it, you know 5 years ago,
``cord cutting''. Now, I call it just, you know, more efficient
adjustments to homes of getting what Internet service they
want. So, I mean, we have a lot of transformation going on at
the same time. That is why this is, I believe, challenging,
just because you have so much transformation.
And you also do not want to leave anybody behind to new
applications. You do not want to preclude somebody from being
the next center of focus. You know, we have an area of our
State in the Columbia Gorge, which is a very challenged
geographic area. Most beautiful area, it has got a national
designation. But they were able to pull off very significant
drone development, that ended up playing major roles for us in
the United States. Very rural, hard to serve area, but they
had, like, nine T1s back in the 90s and were able to pull off
the kind of infrastructure that needed, for that rural
community, to basically, you know, really produce quite, a very
important aspect of technology development.
So, we do not want to preclude that from happening. Yes,
Mr. O'Rielly?
Mr. O'Rielly. I was only going to say, I am not--I do not
agree on terms of the mandate of the basic tier, was his
suggestion, or in terms of rate regulation. What I do think is,
maybe, is looking at the program that this committee set up, in
terms of EBB, in terms of--it is almost a voucher program. And
that being the supplement to, or, maybe, replacing the current
LifeLine program.
So, how do you directly get the benefit to consumers that
may need the affordability issue? I think it is critical to
address the affordability issue, but I think there are ways to
go about it versus some of the government structure that my
colleague may have----
The Chair. Well, I hope we can--you know, I think Dr. Ali
has mentioned some other--you know, he has mentioned rural
electrification. There was a point at which we just said, we
are going to get there, and we are going to get there the
cheapest possible way we can get there, for the hardest-to-
serve population. So, I think we will have to look at that.
I think Senator Rosen is available?
STATEMENT OF HON. JACKY ROSEN,
U.S. SENATOR FROM NEVADA
Senator Rosen. I am. Thank you, Madam Chair, for waiting
for me to vote, I surely appreciate it. And thank you to all
the witnesses, of course, for being here today and for what you
do, what you are working on. And it is really important to this
discussion to make sure that everybody has what they need to
really thrive in the coming century and overcome all the
challenges and obstacles that we have to face.
And so, we need to be sure that we have proper definitions
and good Federal investment. And we see that because, over the
course of the pandemic, broadband has played a role in almost
every aspect of our lives, from education to healthcare to
work. Congress has responded. We have increased our focus on
expanding broadband access efforts, of course, I have strongly
supported.
But how we define--how we characterize broadband access
also has a significant impact on policy development and
resource allocation. As we discussed a little during Ranking
Member Wicker's question, defining terms like, unserved and
underserved, those can have real significant implications on
where we invest our Federal dollars and how we do bring
broadband to everyone.
So, in 2009, Congress defined under--unserved, excuse me,
as any home or business that has broadband speed of less than
10 megabits down, 1 megabit up, and underserved as, any home
having speeds between 10/1 and 25/3. Twelve years and one
global pandemic later, current FCC and USDA programs continue
to use those same definitions to target critical dollars to
deploy our broadband infrastructure. Despite the demands on
connectivity, like, telemedicine, and just ever---the needs for
ever increasing speed in everything that we do.
So, for everyone on the panel, the pandemic has changed,
for sure, what it means to be unserved, or certainly
underserved, in terms of broadband access. So, should we
revisit the definitions and update them on a regular basis, as
no community gets behind? But of course, technology is
constantly changing. What are more appropriate benchmarks, do
you think, for us to use to define a community as it is served
by its broadband network? So, Dr. Ali, I guess you could start
us off and then, we could go down the line.
Dr. Ali. Absolutely. Thank you very much for the question,
Senator. As I have said, I am a big proponent of the 100/100
symmetric definition. I think what they allows is that we are
looking--we are connecting our communities with forward-looking
technologies. We are connecting our communities with forward-
looking speeds, rather than wiring our communities to something
that is just good enough for the time being, and then, leaving
them to fend for themselves. So, I think 100/100 as a
definition.
Senator Rosen. Mr. O'Rielly?
Mr. O'Rielly. To your answer, and I respect and agree with
a lot of things you said, but I would not change the speed
threshold, at this time.
Senator Rosen. Thank you. Mr. Wilkins?
Mr. Wilkins. I think if the history of broadband shows us
one thing is that we always tend to underestimate what is going
to be needed a few years from now. I, therefore, think about it
more as a question of what infrastructure can scale to meet
future needs efficiently versus can we just pick a point today
and say, this is now the right number? And so, I think the
performance criteria we think about for these investments might
want to consider scalability almost as a separate metric versus
a given speed target on a given day.
Senator Rosen. Thank you. And Mr. Forde?
Mr. Forde. We should keep them where they are at, until
those folks, that are truly unserved get broadband. Those
speeds are more than sufficient. Again, as we have mentioned
before, the consumer, even during this pandemic, the number
one, you know, driver of traffic is still, you know,
downloading streaming services, such as Netflix. If downloads
are still 14 to 16 times higher, regardless of the technology,
it is just not something that the consumers are asking for, and
not something we need to go by 100 symmetrical speeds for, at
this time.
Senator Rosen. Thank you. I would like to just follow up
with one last question. And I want to talk about supporting our
State's efforts. You know, I am proud to represent Nevada. It
is a state with a mix of vibrant urban centers and vast rural
areas. More than 80 percent of our land in Nevada is federally
owned or managed. Deploying broadband, therefore requires
substantial Federal and state coordination, cooperation between
the numerous state and Federal stakeholders. So, for this
reason, Nevada's Office of Science, Innovation, and Technology,
their broadband office is on the ground advising communities,
coordinating with Federal, state, and private industry.
So, through both the COVID relief bill we passed in
December, and the American Rescue Plan that President Biden
signed into law last week, Congress has made significant
investments to expand broadband across the country. So, I want
to ask Dr. Ali and Mr. Wilkins, as we continue to build on
those investments, how important is it to give states the
flexibility they need, states like mine who have to deal with
DOD and BLM and DOE, Department of Interior, you name it? We
have unique challenges in every state to expand our broadband
access and how can we help facilitate, better coordinate,
across all areas of government and broadband deployment?
Dr. Ali. That is a great question, Senator, thank you for
asking it. I am a big proponent of the importance of state
broadband offices, exactly like you just said in your home
State of Nevada. I think that they can perform incredible roles
as being, kind of, information wholesalers, and bringing
different stakeholders together, and even identifying
stakeholders who may not realize that they are stakeholders, at
the time. So, I really think, you know, I would encourage every
state to have a robust and well-funded state broadband office,
to really diagnose the needs of their communities and counties.
Senator Rosen. Thank you, and Mr. Wilkins.
Mr. Wilkins. Senator, in the RDOF process, I worked with
states ranging from California to Alabama and in between. And I
would just say first, the current Federal environment, it is
hard for states and their local stakeholders to navigate, just
as you said. The opportunity is so important, though, if there
are going to be substantial Federal investments, I mean, first
point, those are not going to be probably until next year.
Separate from the mapping, I mean, we are just at a point where
Congress has not decided if new funds will be made available.
Even things like RDOF II or 5G Fund I think are on track for,
probably, next year, not this year.
Having states have funds now, to start those plans, to
amplify the impact of Federal investments somewhat down the
road, is just a huge opportunity because challenges, state by
state, are different.
Senator Rosen. Well, thank you. I appreciate it and, Madam
Chair, I see my time is over. Thank you so much.
STATEMENT OF HON. MIKE LEE,
U.S. SENATOR FROM UTAH
Senator Lee. The recent American Rescue Plan, the same
legislation just mentioned a moment ago, appropriated $350
billion to state and local governments. The statutory texts at
issue permitted this funding to be used to ``make necessary
investments in water, sewer, or broadband infrastructure''. To
my knowledge, there were no limits placed in the statutory
texts around the vague broad phrase, investments in broadband
infrastructure.
Mr. O'Rielly, is overbuilding of broadband networks a
possibility from this language? And how does overbuilding
affect the overall broadband market, that is, how does it
affect market competition?
Mr. O'Rielly. Subsidized overbuilding, which this would be,
absolutely is likely to come from this. We have already seen a
number of entities raise their hand and say, I want that money
to go for broadband purposes, in areas that they already have
networks. So, it will depress the existing provider,
potentially--in small instances or with smaller providers,
potentially threaten their viability to serve. It could
certainly steal the major businesses in the area, that they
rely on to be the funding source for going forward.
So, subsidized overbuilding is incredibly problematic for
areas--these are areas that we--you know, we generally say that
we are trying to target the unserved population, where you
cannot have one, you know, one provider does not exist without
subsidies. But here, you are talking about money going to
wherever they want, within a state--incredibly problematic.
There are no limitations. I am hopeful that they will appear
and, maybe because of reconciliation they could not be added
but it is incredibly problematic.
Senator Lee. There are private sector business interests at
companies that spend billions of dollars, in the form of
investments, in their own broadband networks. Is that safe to
say?
Mr. O'Rielly. Oh, absolutely.
Senator Lee. So, what is the effect of Federal spending on
private sector investment in this area? Is there a disincentive
that is created by that?
Mr. O'Rielly. Oh, absolutely, and it also targets which
markets they may go into, based on what the activity of the
state is. So, if a state has been, you know, given carte
blanche and, therefore, they are going to use these dollars for
broadband, to overbuild, then you are going to see dollars go
elsewhere and the consumers trying to compete with these two
systems down.
Senator Lee. Separate and apart from what it might choke
out, is this increased Federal spending something that has the
capacity to artificially divert resources toward inefficient
purposes?
Mr. O'Rielly. Oh, absolutely, in some instances you would
see the providers react and try to, you know, compete against
this government network, in some instances, if it is--or
whoever has been picked to be the winner, build out this new
provider. And you may see them dedicate resources, and lower
the cost in some instances, to try and compete against it and
that would be an inefficient mechanism that the government is
causing.
Senator Lee. Let us talk about the video marketplace for a
minute. Our current video marketplace is governed by Title 6 of
the Communications Act, and it dates mostly back to a law that
Congress passed back in 1992. But technology has, of course,
changed rather considerably since 1992, and now, the same wire
that used to just bring video into American homes, is also
bringing a whole host of other services, as well. Would you
agree that Congress really ought to be taking up reforms to
Title 6, and that doing so could help in our efforts to bring
more effective broadband deployment?
Mr. O'Rielly. Yes, absolutely, I support--if I were to
spend--you know, if I were still at the Commission, that was
something I was going to spend more time on. I think it is
absolutely critical that we recognize the vast number of
competitors that are, you know, that are not regulated by Title
6, competing against those that are, and the relief that should
be provided to existing providers--legacy providers, existing.
Those that have the network, you know, versus this streaming
company's, and otherwise in other technologies, whether it be
wireless, or else wise.
So, I absolutely agree that Title 6 should be reformed and
should be high on the priority list.
Senator Lee. Do you have anything, within your priority
list, of things that we ought to try to tackle first, in that
area?
Mr. O'Rielly. Oh, in that area? Yes, I would happy to be
follow up with you, in terms of different ideas that we should
look at, in terms of reform. There are a bunch of things that,
you know, first priority would be, like, scrape away any
existing regulation, or statutory obligation that makes, no
longer, any sense.
Senator Lee. Right.
Mr. O'Rielly. Two, would be to completely revamp that title
to reflect the current marketplace. And those decisions have to
be reflected in other decisions the Commission makes, whether
it be media ownership, whether it be how DOD--DOJ, excuse me,
treats the marketplace, so those things can flow through in
other instances.
Senator Lee. And, Mr. O'Rielly, what are the top spectrum
policy changes that you think Congress ought to undertake now,
if we are to have an hope in being able to compete with the
rest of the world in deploying next generation technologies?
Mr. O'Rielly. Well, I do believe that the Congress and
certainly the FCC, will have these fights going forward, but we
are going to need to reallocate additional Federal spectrum,
that is used by agencies, to commercial purposes. That has been
a long going fight. You and I have talked about the valuation
bill that you have been so leading the charge on, and so
appreciative. But those fights are going to continue because
the demand for wireless services is going to continue to
increase. And the benefits from those networks, not only just
in terms of consumer benefit, but also, the emergency
communications and everything that goes from that, and the
decreased need on the federally--the more efficiency needed
from the Federal agencies is absolutely critical. And we are
going to have that fight. And so, I would be decreasing the
amount of spectrum allocated for Federal purposes.
Senator Lee. Would it be an overstatement to suggest that
our biggest single impediment there might well be the
government's own misuse, mismanagement of its own spectrum
allocations?
Mr. O'Rielly. I think you worded it very well.
Senator Lee. Thank you. Thank you, Madam Chair.
The Chair. Thank you, Senator Lee. Well, that is all the
members, I believe that are scheduled to ask questions. So,
unless somebody is going to pop up here on one of the remotes,
that we do not know about. But certainly, want to thank you all
for your testimony.
We did not get to really a good debate round on shared use
issues, but I am sure this last question, kind of, primes the
pump for that. A lot to talk about there, including, how do we
all get comfortable, when we talk about coordination of those
agencies. And we also have to talk about the coordination of
use agencies, which has not seemed to go so well in the last
few rounds. And I do not really think we want to be the arbiter
of last resort, the Congress. I do not think that serves us
well. But, at the same time, I think we need to figure out how
we are going to have engineers at various multiple agencies get
on the same page.
So, but we will leave that one for the record. We will get
some comments on shared use and efficiencies in shared use and
engineering--whatever we want to call it, ``engineering
agreement'', something of that nature. How we get people on the
same page, at least with the scientific data, so that we can
all feel comfortable in moving forward.
But this has been a very illuminating hearing. I thank the
witnesses. We will keep the record open for two weeks, until
March 31, 2021. Any Senators wanting to submit questions for
the record, for the witnesses, should do so by that date. And
we ask that you respond to us, to the Committee, by April 14,
2021.
With that, that concludes our hearing, and again, thank
you.
[Whereupon, at 12:45 p.m., the Committee was adjourned.]
A P P E N D I X
USTelecom
March 17, 2021
Hon. Maria Cantwell,
Chair,
U.S. Senate Committee on Commerce, Science, and Transportation,
Washington, DC.
Hon. Roger Wicker,
Ranking Member,
U.S. Senate Committee on Commerce, Science, and Transportation,
Washington, DC.
Dear Chair Cantwell and Ranking Member Wicker:
Thank you for holding today's hearing to examine recent Federal
actions to expand broadband coverage and for your continued leadership
to increase opportunity and economic activity through 21st century
connectivity.
USTelecom proudly represents broadband providers, suppliers and
technology innovators in every corner of the country. Our broadband
networks have been resilient and fully capable of carrying the surge in
high bandwidth traffic during the last year, but this means little to
the millions who lack broadband access or simply cannot afford service
in the first place. We recognize the digital divide is not solely an
issue of access, but of affordability and adoption as well.
The Committee has made meaningful progress in tackling a range of
connectivity policy issues, and I commend you for holding your first
hearing not related to nominations this Congress on broadband
deployment and Federal efforts to incentivize the closing of the
digital divide.
USTelecom and our members are staunch advocates for this critical
direct spending on broadband infrastructure. The important Federal
investments in broadband over the past few months can help achieve our
shared goal, but only if this funding is spent with precision and
coordination among all Federal and state government agencies.
Additionally, thank you for including an analysis of actions taken
to enhance Federal coordination among various programs as a priority in
the notice for this hearing. As Congress considers additional resources
in high cost and otherwise unserved parts of our country, we
respectfully believe more can be done to avoid waste and prevent
overbuilding existing support programs so that every new dollar reaches
truly unserved communities as efficiently and quickly as possible.
Two areas where I encourage the Committee to continue to focus
include:
Updated and data driven, 21st century broadband maps
Thanks to the Broadband DATA Act, updating and modernizing our
Nation's broadband coverage maps is currently underway and incremental
results should be available from the FCC later this year. These maps
must guide the distribution of the historic and essential funding
Congress has approved to reach the unconnected.
We should also learn from past attempts to fund these areas that
resulted in better broadband for a few, but no broadband for many.
These investments must be made based on data to ensure this will be
game-changing and connect the communities most in need.
Stringent interagency coordination
The USDA, the Department of Commerce and the FCC, along with
various stimulus grants over the years, have prioritized serving the
highest number of eligible locations possible through their broadband
programs. While this goal seems like a good one, the reality is it
results in funding the same locations over and over again while leaving
unconnected locations without connectivity.
To ``avoid'' overbuilding, each program continually raises the
definition of unserved, based on a minimum speed requirement. By doing
so, new programs can essentially overbuild the same locations covered
by previous programs by simply upgrading speeds to the locations that
are less expensive and easier to serve. The fast get faster and the
unconnected stay unconnected.
Truly closing the digital divide means first connecting the
unconnected, before increasing speeds for those who already have
service. To accomplish this goal, we must ensure that all government
broadband programs, both Federal and state, are using the same sets of
data and minimum speed requirements when identifying unconnected
locations. Explicit and binding interagency coordination will close the
digital divide while ensuring the efficient allocation of funds by
avoiding funding duplication.
As Congress moves forward with this critical work, we should
identify and modify whatever inefficiencies exist. We are glad today's
hearing will focus on those issues most in need of improvement.
We also hope the Committee will focus on what we know is the most
efficient way to allocate finite resources: public private
partnerships. Working together, government and industry innovators have
shown how these partnerships are the most proven and efficient way to
competitively distribute government funds to connect American
communities.
Broadband plays an essential role in any plan to lift Americans up
and move our Nation forward. USTelecom members are committed to
continuing to work side-by-side with government partners to build and
invest in these networks, and bring high-speed broadband deeper into
all corners of America. We look forward to working with you to ensure
all in America are connected to world-class communications
infrastructure.
Sincerely,
Jonathan Spalter,
President and Chief Executive Officer.
______
Response to Written Questions Submitted by Hon. Roger Wicker to
Hon. Michael P. O'Rielly
Question 1. AT&T recently announced it would cancel its free
wireless data services for all of its subscribers nationwide because of
California's net neutrality law. In your view, has the performance of
broadband networks in the U.S. during the COVID-19 pandemic
demonstrated a need for reclassifying Internet Service Providers as
common carriers under Title II of the Communications Act? Why or why
not?
Answer. Absolutely not. It should be commonly accepted that, for
the most part, America's broadband networks as a whole were able to
withstand extensive pressure and increased use during the pandemic.
This all occurred without the constraints of Net Neutrality rules and
mandates. Indeed, America's broadband providers had years of market
certainty combined with the absence of unnecessary and burdensome
restrictions, which are the hallmark of Net Neutrality, to invest and
build out their networks to meet and exceed consumer demand during the
pandemic.
Question 2. How does the cancellation of free wireless data
services due to California's net neutrality law benefit consumers?
Answer. I don't believe that it does. The elimination of zero
rating services by AT&T in response to California's Net Neutrality
restrictions highlights a disconnect between the supposed virtues of
Net Neutrality and the practical market realities that service
providers must face in trying to comply with such statutory or
regulatory obligations. Zero rating services can bring enormous
benefits to consumers and should not be rejected by consumer advocates
or punished as anti-competitive or unfair to other providers.
______
Response to Written Questions Submitted by Hon. Shelley Moore Capito to
Hon. Michael P. O'Rielly
Question 1. In March 2020, Congress unanimously passed and
President Trump signed into law the Broadband DATA Act. The FCC began
implementing some of the required changes through the FCC's Digital
Opportunity Data Collection. I applaud the recent actions of Acting
Chairwoman Rosenworcel to implement the Broadband DATA Act and forming
the Broadband Data Task Force at the Commission. Once the FCC completes
their new broadband availability maps, would it be beneficial to have
other Federal agencies--that administer broadband-related programs--
work off the same maps? Would this benefit coordination between the
agencies?
Answer. Absolutely. As currently provided by Congress, multiple
Federal Departments and Agencies are allocating funding for broadband
networks--and yet are all operating under different structures and
procedures. This increases the likelihood that funding is being used
for the extremely harmful practice of subsidized overbuilding of
existing broadband networks rather than focusing on those Americans
without access. Despite the well noted problems with the FCC maps, the
awarding of other funding streams is less justifiable or defensible.
Requiring every Federal Department or Agency allocating broadband
funding to use a common set of maps would be a major improvement over
current mechanisms.
Question 2. In December, Congress created the $3.2 billion
Emergency Broadband Benefit Program (EBBP). This program will provide
temporary relief to eligible households with a $50 monthly discount to
help them afford their broadband service. I am happy to see that the
FCC finalized the rules for this program in February and is expected to
open the program to eligible households soon. Depending on how the EBBP
is implemented, do you see this program improving broadband adoption?
Do you believe this complements efforts by ISPs in providing low-cost
service to underserved communities? In your testimony, you mention that
the EBBP could be a more appropriate model to address affordability and
adoption issues. What would be your recommendations on how the program
should be implemented to address those two issues?
Answer. Certainly the Lifeline program has faced considerable
problem in structure and implementation and moving away from it as the
sole affordability solution for technology cost makes a great deal of
sense. Depending on how the EBB is implemented and received by
recipients, I believe that the EBB could be looked as the start of a
more permanent program to deal with Internet affordability and adoption
issues. Such a program could nicely complement or possibly supplant
programs operated by the private sector. If the EBB does gain necessary
traction, it may need to be fined tuned with respect different Internet
costs throughout our Nation to offer service. Additionally, a more
seamless integration into other social welfare programs would make it
more effective. And, it's funding source, from my opinion, should
remain with the Federal government rather than being usurped into the
Commission's contribution mess. As an aside, Internet adoption levels
will always remain challenging, as cost is only one reason why some
Americans do not subscribe for service.
Question 3. In December, the FCC announced the winning bidders in
the Rural Digital Opportunity Fund (RDOF) Phase I which built upon the
lessons learned from both phases of the Connect America Fund (CAF).
Thankfully, through the reverse auction, nine separate providers
received support in West Virginia and my state is set to receive $362
million in total support. As one of the Commissioners approving the
RDOF auction, what are some of lessons learned from previous the high
cost programs? What would be your recommendations to the current
Commission to avoid the pitfalls of the past?
Answer. While RDOF winning bidder long forms are still being
reviewed, it is certainly appropriate to examine the lessons learned
from the auction and its overall structure. In my mind, the key that
made RDOF so significant is it's focus on those areas without any
Internet access--i.e., the unserved. Much of the prior Commission work
centered on upgrading service for those that had access. RDOF showed
that there is great interest by the private sector in competing and
bringing service to hard to serve areas--often at speeds much higher
than anticipated. In addition, the program, like CAF II, rightfully
allowed any technology meeting the Commission standards to participate
rather than relying on incumbent providers, promoting competition among
technologies and lowering overall program costs. This feature will
continue to be debated going forward as there appears to be a fixation
among some policy makers for fiber technology at any cost. My
recommendation for future Commissions is to do the hard work, embrace
reverse auctions, promote technology neutrality, and avoid the
political race for higher speeds.
______
Response to Written Question Submitted by Hon. Shelley Moore Capito to
Justin Forde
Question. The Rural eConnectivity Pilot Program (ReConnect) is the
USDA's latest program to deploy broadband in rural communities and
focuses on areas with the most need. As a member of the Senate
Appropriations Committee, I have been able to secure funding for this
program during the appropriations process because of the need I
continue to see in my state. In your testimony, you mention that the
efforts taken to close the digital divide could be thwarted by
redefining what it means to be ``unserved.'' Could you expand on that?
Why is it important to narrowly focus funding to areas that currently
do not receive a basic level of service? If the ``unserved'' was
redefined to a higher standard, is it more likely that precious Federal
funding would be directed towards new broadband projects or would it go
to upgrading existing networks?
Answer. Efforts to close the digital divide could be thwarted by
proposals to redefine what it means to have broadband service
available. When eligibility is targeted to areas that do not yet even
receive a basic level of broadband service, such as 25/3 Mbps, we know
that funding will be used to bring broadband where it did not
previously exist. To communities and households who truly have nothing.
But when areas are defined as eligible for funding unless they have a
higher level of service--such as recent proposals suggesting an
increase to an arbitrary speed threshold like 100/100 Mbps--this means
that many areas where we and others have invested heavily, including
through public/private partnership programs, are suddenly considered
``unserved.'' Providers will naturally apply for funding to serve these
newly eligible areas, because those are the places that are easiest to
build and serve. This would mean that areas that already have robust
broadband service, including gigabit service, would be newly eligible
for funding, increasing the likelihood that funds would be siphoned
away from areas that are not economical to reach, and have struggled
for years to attract broadband deployment. The result would be that
those lacking broadband service today will still lack broadband service
tomorrow, even after billions of dollars in funding are spent. We
believe these proposals should be reconsidered. For example, in my home
rural state of North Dakota, which shares some similarities with West
Virginia on the difficulties and cost to deploy broadband in rural and
remote areas, here is what happened with the USDA ReConnect program:
ReConnect applications to USDA are flowing in for highly populated
area's that already have broadband at speeds of up to 25/3 Mbps.
Applications are not coming in for the area's that have 0/0. Thus
redefining ``unserved'' will not close the digital divide and only lead
to more applications from providers for customers for those who already
have high-speed broadband.