• The Fifth Circuit Court granted the FCC’s request for a stay of the court’s mandate on the USF (saying it is unconstitutional). This means the E-rate and RHC programs will continue to operate as normal for now. This is probably headed to the Supreme Court.

• Next Generation 911 (NG911) – On July 9 the FCC ordered all carriers and local governments to complete this transition. In technical terms this moves 911 off the traditional public switched telephone network (PSTN) to an IP architecture.  This is causing extra cost since local governments are having to support both the old and new protocols until complete transition.  Without getting into technical details, the FCC ordered the transition in two phases.  The new process will:
  • Eliminate carrying the 911 calls out of state (which made no sense)
  • Reduce the risk of 911 outages
  • Reduce costs in some areas

National cellular carriers, text providers, and wireline providers other than rural incumbent local exchange carriers (RLECs) will have six months to implement a valid request from s State 911 Authority.  Small telcos, non-nationwide CMRS providers, and Internet-based TRS providers will have one year to implement a valid request to change.

Missouri is working hard on this transition and over half the counties have received grant funds for the cost.

• New York State’s Affordable Broadband Law – New York has a law mandating affordable broadband prices for low-income consumers. This law requires monthly broadband prices of $20 or less for eligible subscribers.  This has been met with much resistance.
  • The law was upheld by the Second Circuit Court.
  • ISPs requested that the U.S. Supreme Court strike down this law.
  • New York Attorney General temporarily halted enforcement of the law while the Supreme Court considers the appeal.

The legal battle reflects ongoing tensions between state and federal authorities over the regulation of broadband services.

• Click-to-Cancel Initiative – FCC has proposed rule that would require companies to make it as easy to cancel service as it is to subscribe as part of their consumer-friendly initiatives. A couple other initiatives are:
  • Requirement that would provide customers with the ability to talk to a human by pressing a single button. Some companies only provide customer service using AI chatbots and this would also eliminate having to wade through a maze of bot questions to get to talk to somebody.
  • Executive order to eliminate junk fees, which are hidden fees for services that are not known to customers.

• Is There a Technician Shortage – a recent study, Broadband Markets Workforce Needs, predicts the industry is going to be short of the fiber construction workers, fiber technicians, and engineers needed to meet the upcoming broadband deployment. They also predict there will be 199,200 fiber construction workers and technicians retiring over the next decade to replace.
  • Must find a way to fill these positions or there will be significant BEAD construction bottlenecks and delays.
  • Currently, construction contractors are saying they are not having problems finding workers so cannot justify putting effort and cost into hiring and training.
  • Still lots of projects occurring now and awards of other programs in near future, plus the continued expansion of the big telcos, cable companies and fiber overbuilders will increase the demand for more labor workers.
  • Labor shortage will result in fiber construction projects to fall behind schedule.

Providers are thinking about this this and will probably have to address it in the future.

• MISSOURI and ARIZONA BEAD Proposal Approved -Missouri and Arizona were among eight states to get Initial Proposal Approved. This means these states can now draw down the full amount of their NTIA BEAD funding allocation and begin process of administering them to subgrantee award recipients. This sounds good but it also means the 1-year time clock is ticking.
• Bottlenecks in the BEAD process is expected but maybe not in the areas most people expect. T is not expected that most of these delays will be crippling like during covid and they may not impact all projects (more regional). But delays will slow construction at times and that can mean extra cost for anybody building a network.  Some areas that could be impacted:
  • Engineering and Design – a lot of miles of fiber to design in 2025-2026 that could easily result in a 50% increase in demand for the folks who design networks.
  • Environmental Studies – Many BEAD studies will require environmental studies. This is something that is not done for most other fiber construction.  Expect 2025-2026 in early process stages.
  • Locators – Expect more aerial than buried fiber built with BEAD, but there will still be a substantial need for buried locators. Expect this more in the rural counties that don’t have the resources available to handle big increase in workload.
  • Pole Make-Ready – One of biggest bottleneck expectations will be from pole-owners that get swamped with huge numbers of requests to get onto poles.  There are regulatory rules that say the process has to be speedy but that’ not going to matter when the pole owner can’t handle the volume.
  • Permitting and Rights-of-Way – local governments will be asked to issue a huge number of permits for construction. This will be the same as locators in rural areas, not enough resources/staff.  ISPs currently building in rural counties are already hitting these delays.
  • Fiber Contractors – It is believed that all BEAD projects will find a construction contractor. The delays will come from contractors trying to keep technicians.  The Powers and Communications Contractors Association recently indicated there is a current shortage of 28,000 experienced construction technicians.  This can only get worse.
  • Fiber Materials – Providers will be wanting to buy materials within a relatively short time window. Add to this, manufacturers trying to supply everybody with BABA -compliant hardware.
• NTIA issued Alternative Broadband Technology Guidance says:
  • The extremely high cost per location threshold is a subsidy cost per location, established by eligible entities that may decline to select a proposal for reliable broadband service if use of an alternative technology meeting the BEAD program’s technical requirements would be less expensive. NTIS t issue additional guidance regarding the use of alternative technologies to serve unserved and underserved locations.
  • As a starting point, regardless of the technology used, the Bipartisan Infrastructure Law requires internet service providers to deliver speeds of 100/20 MBPS and latency of less than or equal to 100 milliseconds.
  • States must use “reliable broadband” technologies first. This is internet service that meets high-speed thresholds, can adapt to changing societal needs, and provide service for decades.
  • Fiber builds are priority projects for BEAD.
  • Next priority is other “reliable broadband technologies” like coaxial cable or licensed fixed wireless.
  • In limited circumstances, states can choose to fund projects using unlicensed fixed wireless and low-earth orbit satellite broadband service (must meet speed and latency requirements).

• Is 5G faster than 4G?
  • Ookla recently surveyed and compared the time it takes to load pages for Facebook, Google, and YouTube on cellphones for both networks. The time needed to load a web page is directly impacted by latency which measures the lag between the time a phone requests a website and website responds.
  • Results showed:
    • 5G improved page load times by 21% to 26% for the above three popular websites (26% for Facebook, 22% for YouTube and 21% for Google)
    • This is overall result and does not mean that 4G is not faster is some areas and neighborhoods.
    • NOTE – measuring page load time is not the same as measuring speed on a speed test.

FINAL SUMMARY – the long list of big improvements that were promised by 5G never materialized.  That being said, these national statistics will vary by market.  It is also likely that the performance of these two technologies differs during the day as the load on the networks ebbs and flows. But the Ookla statistics show that, overall, there is better performance on 5G

There are no updates this month.

• Broadband Fairness Act – in August, Senator Josh Hawley from MO filed this legislation. The Act is simple and would return any defaulted grant funds administered by a federal agency back to the State where the award was originally intended. The Act encourages the states to use the money directly for the areas that were affected by the default if still unserved.
  • Can be complicated. Consider that RDOF is paid over ten years.  Would need to consider if this means states would get those funds over 10 years and how states will develop a process for use.
  • Would apply to RDOF, ReConnect, CPF, SLFRF, EA-CAM, NTIA CAF-II and BEAD (with a grant program of this size there will be defaults).

This Act is a way to get defaulted money back into action much faster than waiting for federal agencies to launch a replacement grant program.  It is expected that this legislation will take bi-partisan support and sponsorship to get traction but what a great idea!

• NTIA has been slow in launching the 2 DE grant programs.
  • Law was enacted in November, 2021 and grants were intended to start being issued in 2022. It is now 2024.
• Competitive grant program had short application window.
  • Grants must be spent within four years of date of grant award with one additional year to “measure and support” the grant funded activities.
  • NTIA WARNS THAT NO GRANT EXTENSIONS WILL BE ALLOWED.

• FCC updates speedtest app for IPhone, Android
  • FCC rolled out new mobile speed test app to allow users to test their broadband speeds and SEND THE DATA BACK TO THE AGENCY.
  • Effort to collect more accurate data and this data can be used to challenge the coverage data reported by providers
  • New version of the app in on the FCC website for downloading.

• One of the biggest challenges for BEAD grant is for State Broadband Offices to make sure that every unserved location gets covered by the grants.
  • NTIA will not approve the BEAD grants being made by the State until they can demonstrate that every unserved and underserved location will be covered by the grants.
  • The problem States will encounter is finding a solution for the many small pockets of unserved customers. Finding an ISP to build to these many small areas will be a challenge.
  • In the majority of states, the number one criteria for awarding grant points is by having the lowest construction cost per passing. This typically is achieved by an ISP having a network that only goes to larger pockets of unserved customers.  The cost per passing climbs dramatically if network is to reach scattered smaller pockets.
  • To make matters worse for an ISP, BEAD rules frown on funding any middle-mile fiber that might be needed to reach the remote pockets.
  • Dilemma does not apply just to fiber ISPs. Wireless networks don’t reach everywhere because of dead spots created by hills and terrain.  A wireless ISP will often have to build extra towers and backhaul to reach every location in these disjointed BEAD areas.
  • The author of this article predicts that ISPs will refuse to take on impossible service areas and this will add months to the grant process and potential negotiations.
• Low-Cost Service Requirements
  • Several industry groups and associations have urged NTIA to relax the low-cost service requirements for the BEAD program. No action to date.
  • Request state the $30 low-cost requirement is unrealistic and could hinder the program’s success in high-cost, hard-to-reach areas.
  • ISPs providing service in rural areas where they can average 1-5/6 homes per square mile that are having to offer a $30 plan is below their operating costs and just not reasonable. They are unable to provide these households will the same level of installation, service and support as homes paying the standard rate.
• Compliance with Buy America Requirement
  • NTIA released a narrow and targeted Bild American, Buy America (BABA) waiver for the BEAD program.
    • Waiver requires certain equipment be produced in US while waiving domestic manufacturing requirement for other equipment.
    • Still results in the majority of fiber equipment and electronics being made in the United States.
    • Entities to self-certify and report compliance with the BABA requirements and use of the waiver.
    • This is complicated and should be reviewed carefully on the NTIA website.
  • NTIA considers the BEAD program not just a connectivity program, but also a jobs program which is part of the reason for these requirements.

There are no updates this month.

There are no updates this month.

• RDOF Defaults
  • FCC authorized 379 companies to receive $6 billion in RDOF support over a 10-year period, covering just under 3.5 million locations in 48 states and 1 territory.
  • As of July 10, 2024, only 16 out of 379 recipients have defaulted (FCC has not published a list showing the relevant number of locations associated with defaulted census blocks, nor can we find any outside party that has undertaken an attempt to figure this out.
  • Defaulting companies are not volunteering those numbers and its difficult to mash up the FCC spreadsheet of defaulted census blocks with the other spreadsheets released before the auction.
  • As a result, the general public doesn’t know how big or small the problem is.
  • Even recent defaults and partial defaults do not mention the actual number of defaulted areas or the amounts.
• February, 2024 a coalition of 69 ISPs and others, filed a letter with FCC seeking amnesty for companies that default on their RDOF or CAF deployment obligations. The FCC found no demonstrated need for broad relief and no changes were needed.
  • Based this decision on fact that only 4% of CAF II recipients were reporting not timely meeting their buildout milestones and 71% of RDOF carriers had reported locations as served a full year prior to the first deployment milestones.
  • This does mean that 29% of RDOF carriers have not reported any deployment a year ahead of their milestones.
• FCC currently reaching out to RDOF companies to get updated status of their projects.
  • Examples of responses from 8 companies did not indicate to FCC there would be a problem in completing their requirements.
• Mandatory milestones for RDOF do not occur until the end of 2024 and in many cases 2025.
• Most RDOF winners to have 40% of their RDOF committed areas in each state by end of this year.
  • Failure to meet these commitments could result in reduction or end of subsidy payments and even FCC tapping into the funds guaranteed by letters of credit.
  • FCC standing firm and expects carriers to fulfill RDOF obligations.

• Here are the three publicly available resources to help potential applicants prepare for the Competitive Digital Equity Act NOFO release later in July:
  • Digital Equity Competitive Grant Program | National Telecommunications and Information Administration (ntia.gov)
  • Digital Equity Act at a Glance | BroadbandUSA (ntia.gov)
• Competitive Grant Program Get Ready One Pager.
• It is also recommended using the Digital Equity Act Population Viewer to understand how many people are in each Covered Population in the area an applicant would serve

• Pots and Pans Publication in their June 5 edition discussed several policy items that were inserted into the congressional bill that reauthorizes funding the NTIA:
  • Both House and Senate added language that would require that a national broadband plan be created that would try to put the FCC, the NTIA, USDA, and other agencies on the same page. The author stressed that it is clear that the 3 agencies do not coordinate in trying to solve the broadband gap.
  • The biggest flaw in the BEAD maps is the decision of the FCC to still allow ISPs to claim marketing speeds rather than actual speeds. They suggest this FCC reporting requirement should be changed.
  • The article suggests that FCC thought they had accounted for the map problem by allowing for a map challenge process, without realizing that the counties that have the biggest broadband gaps are the ones with no staff or budget, so the places that should have undertaken map challenges are doing nothing. PLUS, the map challenge process for BEAD is so technical even well-funded counties cannot come close to putting up a decent challenge.

• Some legislators are accusing NTIA of violating rate regulation rules of the Infrastructure Act.
  • BEAD regulations require providers to set up affordable plans for low-income households to get connected on BEAD funded infrastructure.
  • NTIA specifically is asking for a price point or formula that will be used to calculate the low- cost plan.
  • Legislators say this is illegal and NTIA is stating they are not setting rates.
  • A few states plan required providers to submit their own low-cost plans as part of the application process with no requirement of a state wide requirement but NTIA has pushed back and asked the states to set up more concrete requirements around this provision
  • There have not been many state plans approved by NTIA and those that have been approved have a specific price point.

• NTIA Internet Use Study (November 2023)
  • Compared internet users from 2021 to 2023.
  • Showed 13 million more internet users in the US between the time frames.
  • 83% of people ages 3 and older in US used the Internet in some fashion in 2023, compared with 80% in 2021.
  • These gains came in large part from segments of the population that historically have been unserved. 83% of American Indians and Alaska Natives used the Internet in 2023, up from 75 %in 2021.
  • Internet adoption increased in lower-income households, from 69% in 2021 to 73 % in 2023 among households making less than $25,000 per year.
  • 72% of people lived in households with both fixed and mobile Internet connections in 2023, up from 69% in 2021.
  • Just 12% of people lived in households without any internet connection in 2023, compared with 14% in 2021.
  • 80% of people making $100,000 or more per year had both fixed and mobile connections.
  • Only 54% of those making less than $25000 per year had both.
  • 25% of Hispanics are smartphone users only.
  • 22% American Indians and Alaska natives are smartphone users only.
  • 16% of black Americans are smartphone users only. Of white non-Hispanics and Asians are smartphone users only.
• The full survey is available on the NTIA website.

• The ACP has officially ended.  There is nothing on the horizon federally, in the near future, to replace this program.  At this time, it is up to the individual states and the providers to address affordability, the number 1 reason for not subscribing to broadband.  An article in Telecompetitor identified 14 providers who were offering ACP replacement programs offering plans at $30 or less to low-income households through 2024:
• 
• There are other providers across the nation providing low-cost plans. Of note, some of the plans do not meet the definition of broadband at 100 Mbps download and 20 Mbps upload.

• Letter of Credit
  • On June 6 the FCC Commissioners unanimously adopted revisions that eased the Letter of Credit requirements for the RDOF program. The FCC also indicated it is looking at extending these eased LOC requirements to the CAF II program.
• Defaults of Providers on Previous Awards
  • A petition was submitted to the FCC asking them to offer an amnesty period to encourage providers that wish to default to do so sooner rather than later to free up those locations for the BEAD program.
  • The reasoning for the petition was due to the fact that locations awarded under previous programs are ineligible for the BEAD funds. Should providers default on these awards after BEAD locations are finalized, that could leave locations in the hardest-to-reach areas of the country without access to federal broadband funding.
  • The FCC concluded that there is no need for “broad relief” from penalties for broadband providers that default on awarded locations through RDOF and CAF II, citing its existing procedures and concerns about program integrity.
  • FCC further said it will continue to waive certain penalties on a case-by-case basis and urge individual providers to contact the Bureau as well as their state Office of Broadband to discuss their specific situation.
  • FCC has guidance available for RDOF and CAF II support recipients on procedures for provider defaults to ensure that broadband networks are deployed to all consumers. You may read the guidance on the fcc.gov website, Public Notice dated July 3, 2024, DA 24-646.
    • AU Docket No. 20-34
    • AU Docket No. 17-183
    • WC Docket No. 19-126
    • WC Docket No. 10-90
  • This guidance is long and detailed. It is encouraged that all providers become familiar with the guidelines.

No updates

• Net Neutrality Order
  • Reinstates nearly the same Title II rules back that were vacated by the Title II authority (previous administration).
  • Refers to broadband as BIAS (broadband internet access service and ISPs are3 called BIAS providers.
  • Broadband is considered to be a telecommunications service, not an information service.
  • FCC granted itself new and expanded authority to defend national security. FCC added addressing cyber security issues to its role.
  • Gives more tools to deal with network resiliency and reliability related to natural disasters. Gives FCC authority to make ISPs participate in the Mandatory Disaster Response Initiative.
  • Reinstate3s privacy and data security rules under Section 222 rules have only been applied to voice services.
  • Gives FCC authority to develop rules that apply to ISPs that serve multi-dwelling units.
  • Extends opportunities to ISPs who provide broadband-only and no other services that are under FCC jurisdiction. That should help such ISPs for issues like attaching to poles.  It also allows such ISPs to participate in USF support funds.
  • Authority to require ISPs to provide better access for people with disabilities.
  • Services like peering, traffic exchange and interconnection fall under Title II authority.
  • Expanded authority to preempt states that want to regulate broadband.
  • FCC specifically decided not to expand contributions to the USF to include broadband. There has been a lot of lobbying to have FCC pick up the expiring ACP program and this shut that door.
  • Definite that FCC would not engage in rate regulation but states they do have authority to do so.
  • Adopting all of the rules referred to as net neutrality.
  • Reinstating transparency rules for ISPs first put in place in 2015– disclose accurate information to customers involving network management practices, network performance, prices, etc. For now, these rules will only apply to ISPs with more than 100,000 customers.
  • Reinstates both the informal and formal complaint process wher4e consumers can lodge complaints against ISP practices.
  • Reminds ISPs that it has the ability to enforce broadband regulations using fines or other tools.
• Definition of broadband is especially important now since Title II regulation passed. The broadband definition defines what is and what is not directly regulated.
• 4 Major arguments the larger ISPs make against regulation.
  • Prices are down – this is based on the ISPs measuring the speeds by price per megabit of speed, not cost. Statistics show the price of broadband continues to increase.
  • Broadband investment has accelerated – ISPs believe no regulation spurs them to invest more. There is no real-world evidence that this is true.  Networks are continuing to be built to keep up with competition.
  • Competition has Intensified – Same as the one above with different words. Plus,. due to mapping errors and false information, competition is over-stated.
  • Internet speeds are up – speeds are up for 2 reasons; 1) big improvements in technology and 2) public demand for faster speeds are up.
• FCC imposed a $10,000 fine to an Ohio ISP for false claims of providing service to block its competitors from receiving government grants. This was identified through an individual challenge and not caught during the FCC’s required reporting process which causes questions of other misrepresentation.
• Clarification on NTIA’s adoption of environmental exemptions for BEAD projects – “BEAD participants will not have to conduct detailed environment assessments for laying aerial or underground cables, installing or upgrading most wireless towers, conducting outdoor research, building or upgrading some support facilities and more administrative and deployment work.”
• Broadband ISPs from 15 states want exemption from digital discrimination reporting that is being proposed by FCC. If adopted without exemption for rural providers, the companies will be forced to comply with duplicative reporting with additional costs and burdens.
• Efforts to block state USF mandates – some states are passing legislation to require broadband ISPs to contribute to the state USF programs. Some ISPs are asking FCC to preempt states from doing this.  At the federal level, broadband ISPs have never been required to contribute to the USF.  There is mixed support for this request.
• While they never exercised it, the FCC has the ability to regulate rates unde3r Title II
• There is no possibility for wireless technology to keep up with the increased demand that will be expected in 25 years. The only way to increase wireless speeds and capacity would be to greatly increase the size of wireless channels, which the FCC is unlikely to do or use much higher frequencies.  Over time wireless last-mile technologies will fall behind fiber in the same way that SDL slowly fell behind cable modems.

• RDOF defaults are tossing more locations into the BEAD process at this late date. Broadband Offices are way down the road without considering these locations in defining high-cost plans, stretching the funds to reach all unserved, either in the middle or done with challenge process, other ISPs have not considered building into these areas since already awarded, etc. The BEAD program is not the answer to fixing these defaults.
• A state broadband director warns there is not enough capacity to deliver BEAD program as presented. Tight timeframes paired with not enough capacity in the sector to build all projects at the same time are issues.  The average permitting process alone takes between 18 and 24 months.
• BEAD contracts are the most important documents that define what a grant winner must do to fulfill the grant and how they will be reimbursed.
  • What line of credit must be provided?
  • Specific environmental studies required and timing.
  • Reimbursement for completed work – this is a critical component that defines what ISPs are going to have to carry until reimbursement.
  • Grant compliance, i.e. labor force, labor, all other requirements
  • Completion date
  • Be sure to review and discuss items of concern with the OBD before signing the contract.

• State of Internet 2024 (WORLDWIDE)
  • 5% females connected to internet and 68.8% males.
  • 8% of access comes from laptops and desktops.
  • 8% of urban residents use the internet vs 48.9% rural people.
  • Average time spent online is 6 hours 40 minutes a day.
  • Countries with most average daily use
    • 9+ hours – South Africa and Brazil
    • 8-9 hours – Philippines, Columbia, Argentina, Chile, Russia, Malaysia and UAE
    • The US is 7 hours 3 minutes and ranks 20^th in the world.
  • Age groups
    • 16-24 years old = 7 hours 15 minutes
    • 55-64 years old = 5 hours 15 minutes
  • The US is 36^th place in percentage of social media users @ 70%.
  • Online ads represent 70% of all advertising dollars.
• US News and World Report did survey with concentration on what people are paying for broadband (2500 respondents nation-wide)
  • 95% of US adults use the internet.
  • Number 2 concern is price.
  • The price for the internet has risen since respondents first signed up for internet.
  • New Jersey has the highest broadband rates with monthly bill of $126. Also New Jersey has seen the biggest bill increase by $28 since first purchasing broadband.
  • The lowest internet bills are in Montana with an average monthly bill of $70.
  • North Dakota has seen a drop of $4 since first signing up.
  • 54% of respondents bundle broadband with another service. This is down from the last survey.
  • 38% do not know the speed they are buying.
• Some estimates are showing that the4 cost to build a new broadband network increased 20% to 25% over the last few years. While high it is not unprecedented and there have been several worse periods of inflation in the past.
• Broadband Now survey – over the past 6 months they manually checked 65,000 addresses and compared against FCC new mapping fabric and still found overreporting continues to be rampant and exists in every state across every technology type.
• AT&T fixed wireless subscribers continue to increase at more than expectations (350,000 mobile subscribers in one quarter). This is concerning in that Missouri BEAD rules show fixed wireless is considered underserved.

No updates

No updates

• NTIA has taken action to streamline and accelerate the federal permitting process by:
  • Improving its environmental and historic preservation review
    • National Environmental Policy Act (NEPA) streamline where they are adding 30 new categorical exclusions from the First Responder Network Authority to expedite review of projects with minimal environmental effects.
    • Adoopting FirstNets Programatic Environmental Impacts to take advantage of existing analyses when applicable to reduce time and effort for those not categorically excluded.
  • Mapping tools for early permitting identification and environmental screening to help plan projects and identify permitting considerations as early as possible.
  • BEAD NEPA Partnership strategy to maximize all efficiencies.
  • National Historic Preservation Act streamlining of rules.
• FCC signed MOU with FTC taking back some oversight duties over broadband providers and voted to reclassify broadband providers as “common carriers” under Title II of the Communications Act.
  • FCC can stop providers from throttling or prioritizing certain kinds of traffic.
  • Goes into effect with FCC net neutrality order set for 60 days after publication in federal register.
  • Broadband groups are challenging this.
• Most ISPs state that the largest impediment they encounter for building new fiber networks list pole issues at the top of the list – who pays for replacement?
  • Most poles are owned by electric utilities, telephone companies or municipalities.
  • Pole replacement occurs mainly when not enough room on existing pole for required safe distance between wires required for safety codes.  Common fix is taller pole and move wires from old pole to new poles.  This is a lot of expense.
  • Some must be replaced because they are obsolete or in bad condition.  FCC issued new rules to identified poles out of compliance would have shared costs.
  • It is expected that BEAD grants will be used to replace huge numbers of poles.
  • Poles are typically expected to last from 30 to 50 years.
• FCC announced plans to introduce a rule that would expand customer choice in apartments, condos, public housing and other multi-tenant buildings.
  • Applies to landlords doing bulk billing.
  • Allows tenants to opt out of a bulk billing agreement with landlord and get their own internet.
  • This brings concern as allowing tenants to opt out to save money or lower rent could kill the model of bringing broadband to public housing.
• FCC increased the definition of broadband from 25/3 Mbps to 100/20 Mbps. Experts say this should have occurred a long time ago.
  • Before pandemic 46% of households subscribed to speeds under 100 Mbps. Today only 10% buy slower speeds.
  • Information shows that people want to buy faster broadband when given the option.
  • Definition of broadband has financial and political overtones and it determines where grant funds can be spent. Upping the definition also has market consequences.  Any ISP offering speeds less than 100/20 Mbps today is no longer selling broadband.
  • It took nine years to move the definition from 25/3 to 100/20 Mbps.  Congress already acknowledges that 100/20 is obsolete and that federal grants should be spent to build gigabit networks.  Studies show the demand for gigabit broadband is already here today.

• Is there enough BEAD Funding:
  • It is not just high-cost areas that can demand more funds. The condition of poles can be a huge cost driver everywhere.
  • Another factor driving up costs is the way that the FCC awarded RDOF. RDOF awards chopped many counties into swiss cheese serving areas that left large percentages of the county uncovered.  In doing so, RDOF left behind “scattered pockets” of the least dense homes.  The cost to serve these locations are high,
  • Inflation and BEAD grant rules are driving up the cost of construction. BEAD rules can easily add up to 30% of the cost of building a rural network due to factors like prevailing wages, letters of credit and environmental studies.  Many engineers estimate that inflation has also increased costs by 15% to 20% since the BEAD grants were announced.
  • States are relying too heavily on using fixed wireless as the3 solution for high cost areas (depending on location).

• How the Pandemic Changed Broadband
  • Upload Speeds – people tried to work from home and students tried to attend class from home and increased zoom meetings. The pandemic turned the upload speeds into a crisis.  Providers are having to take upload speeds into consideration with their technology.
  • Working at Home – The pandemic sent huge numbers of people home to work and many have never gone back to the office. Before pandemic about 10% of homes had somebody working from home even part time.  Today that number is 15% of homes having someone working full time and 50% of homes have somebody working part time at home.
  • Outrage over Lack of Rural Broadband – The pandemic brought to national attention that rural folks do not have broadband.
• Home broadband adoption rates in rural ar3eas have historically been 5-10 percentage points lower than those in urban locations – due to availability and higher monthly costs.  Urban was 21% and 46% same timeframes.

• Senator Fetterman proposed bill to make a permanent program by folding ACP into the Universal Service Fund. Broadband providers and tech companies pay for the expansion with no charges to the users.
• Senator Clarke filed a discharge petition to force a vote on the ACP Extension Bill for 1-year renewal but it needs a majority of the house to sign on – it is stalled. This is a controversial bill as many believe that making ISP’s pay would lead to highe3r consumer rates so the customers would still pay.
• Charter, the program’s largest participant, is providing 5 million subscribers an extra $1 if they continue receiving service.

• FCC fined AT&T ($75,000) and AMG Technology Investment Group ($100,000) for communicating about bidding strategies during CAF II auction. This was a violation of the “quiet period” when registered bidders are not allowed to communicate about FCC auctions (anti-collusion laws).FCC fines wireless carriers $200-M for sharing access to location data
  • T-Mobile $91 M
  • AT&T $57 M
  • Verizon $47 M
  • Sprint $12 M
  • Carriers are to protect customers information and the above carriers sold access and then resold again to 3^rd Appeals by the 4 providers are in process.
• FCC and RDOF Defaults
  • Fines have been set at $3,000 per passing (location) for the defaults.
  • 1^st fine to Etheric Communications for $732,000 for 244 locations – they failed to become designated as an Eligible Telecommunications Carrier (ETC) for the affected locations.
  • GigFire (or LTD) was fined $21.7 M for defaulting on 7,238 locations. LTD was the largest RDOF auction winner claiming $1,.32 B.  They failed to obtain ETC status for the affected locations and because the FCC does not believe the company met the funding requirements.
  • Other defaults to Charter, Nextlink and Breezeline.
• RDOF deployment rules
  • Deploy 40% by the end of 3 years
  • 60^ by end of 4 years
  • 80% by the end of 5 years
  • 100% end of 6 years
  • The 3^rd year will be in 2024
  • NOTE -the percentages are measured on a statewide basis so if a winner won multiple counties in a state they could be meeting the statewide requirements without doing any construction in some counties.

• Humans are needed for digital inclusion to be successful.  Technology is not going to solve the digital divide without people involved to “guide” or “navigate” those who need help managing technology and the internet.

• 5-Step ladder to digital inclusion:

• • Affordable connectivity

• • Appropriate digital devices

• • Digital skills

• • Technical support

• • Applications
• Difficult to measure and evaluate digital equity completion and success so goals are typically shown as broader outcomes.  It would be labor intensive to get the details especially when community partners are involved.

• It has become common for ISPs to claim they are making upgrades that would bring faster speeds prior to BEAD fund awards. NTIS is recommending to states that they have policy for ISP to sign a binding contract with the state that defines when the upgrades would be completed and guarantee the faster speeds (maybe no more than 12 months)

• ISPs are allowed to declare marketing speeds instead of actual speeds. This allows them to declare a speed capacity of higher speeds but deliver something slower.  This turns the responsibility on a community to somehow prove that actual speeds are slower than the claim (for challenge).  Policy should be changed from marketing speeds to actual speeds for reporting purposes.

• FCC adopted change to its pole attachment rules in December 2023:
  • Rules do not apply to everyone.
  • DOES apply to poles owned by investor-owned utilities and telephone companies but NOT those owned by cooperatives and municipalities
  • Only effective in 27 states that follow FC pole jurisdiction.
  • MISSOURI is not one of the 27 states as we have our own authority.
  • Our state has the option to adopt or ignore these revised rules.
  • Changes to the FCC rules include.
    • Created a Rapid Response Process to expedite pole attachment disputes.
    • If FCC jurisdiction, the disputes are handled by FCC, and they are taking too long. This rule change requires FCC to expedite this process.
    • Make the pole attachment process more transparent. Pole owners have 10 business days to provide report in information about the poles condition to a potential applicant.
    • Most contested piece is that FCC modified the conditions under which a pole attacher has to pay for the full cost of replacing a pole when there is not enough room to add fiber.
      • Old rule – when pole replaced for the benefit of new attacher, the new attacher picks up full cost.
      • New rule – defines term “red-flagged” poles to define poles already out of safety compliance or that are already scheduled for upgrade or replacement. In these cases, the new pole attacher would not be responsible for cost of replacing these red-flagged poles but instead the cost would be pro-rated.

• Community Anchor Institutions (CAI) must have access to symmetrical gigabit speeds, or they are eligible for the BEAD process

• Suggestions to be prepared for the challenge process:
  • Use location specific evidence.
  • Register early in the challenge portal, test it out.
  • Submit challenges early – don’t wait until the last minute.
  • Include dates on type P challenges – evidence of planned build with date expected deployment (must be before June 30, 2024)
  • Provide speed data for Community Anchor Institutions

• 51 organizations, most from the Midwest, are questioning FCC national broadband maps for BEAD eligibility. They have identified 5 key findings:
  • Over reported service availability (specifically fixed wireless network capabilities and reach). Also reporting companies that are making name changes to avoid challenges.
  • Challenge process inadequacies – suggests updating challenge code categories and permitting challengers an opportunity to rebut provider responses
  • Need for independent verification requests – outside verification and additional justification for retroactive map adjustments
  • Enforcement against bad actors – against providers that submit consistently inaccurate data.
  • Technical and access information gaps – hard to verify broadband service due to lack of publicly available information about provider networks.

• One rule of BEAD is that broadband needs to be offered to every unserved location, not 98% or 99% – but all of them. Some opinion is even if there was a 100% grant to reach locations, these remote pockets will always lose money since revenues will never cover the cost of maintenance. ISP’s are not going to be interested.  Even wireless providers will not reach every home without a lot of extra effort and cost.

• The average broadband monthly gigabyte usage in the US was:
  • 2018 – 270.2
  • 2019 – 344.0
  • 2020 – 482.6
  • 2021 – 536.3
  • 2022 – 586.7
  • 2023 – 641.0
  • 9% annual increase of gigabytes – this a large!
  • There was also a huge shift to homes subscribing to faster speeds.

• Survey of Internet Costs (US News and World Report) – of respondents, 1 in 3 (39%) said:
  • They have had to cut personal expenses in order to pay their monthly internet bill.
  • They are settling for speeds that are often sluggish and inadequate.
  • 85% go online every day.
  • 8% had no home broadband access.
  • 20% had one or no other choice of ISP.
  • 61% say inflation is making it difficult to pay monthly broadband bills.
  • 28% are unhappy with the speed they get for the price they pay.
    
• Article titled “Pigeons an Be Faster than the Internet” (Washington Post) – using pigeons to communicate has a long history, back to ancient Greece where they were used to spread the word of the winners of the Olympic games. Racing pigeons have been clocked at 40 MPH with a range of up to 400 miles. The article compared where pigeons could be faster, specifically in “rural” America where slow upload speeds are common. Summary – pigeons carrying a thumb drive are far faster for sending small data files across town

• 2023 had slow down of fiber network buildouts
  • High interest rates when borrowing money (2 times the rate from last year)
  • New home start ups down affecting proposed fiber expansion needs.
  • Inflation – cost at least 20% more to build a fiber network by end of 2023 than a few years earlier.

• Upload speed usage and demand is growing faster than download speed.
  • Increased zoom and other video calls
  • 30% of homes have someone who works from home.
  • Use of more security cameras
  • Using cloud software needs a constant upload path.

• ACP will not be available forever.  States need to begin discussions of a backup plan to make broadband affordable once ACP is no longer funded federally.

• RDOF, phase one, awarded $9.2. Of this amount $2.8 has gone into default
  
• The idea of whether the RDOF areas will be 100% served when those networks are built is doubtful. The RDOF rules did NOT mandate 100% coverage.  People skipped by RDOF will remain unserved after BEAD. 

• Humans are needed for digital inclusion to be successful.  Technology is not going to solve the digital divide without people involved to “guide” or “navigate” those who need help managing technology and the internet.

• 5-Step ladder to digital inclusion:

• • Affordable connectivity

• • Appropriate digital devices

• • Digital skills

• • Technical support

• • Applications
• Difficult to measure and evaluate digital equity completion and success so goals are typically shown as broader outcomes.  It would be labor intensive to get the details especially when community partners are involved.

• FCC considering new broadband definition to 100/20 but they believe that an upload speed of 20 Mbps will not be enough for the future.  If they increase the speed definition, many areas and users would now not meet the definition of broadband that was funded in previous programs.  FCC has also talked of increasing speed to symmetrical 100/100.

• • FCC has held back on 100/100 but many providers cannot provide the 100 Mbps upload.

• • The changes in technology will dictate this in the future.

• The last time FCC set a standard speed was in 2015 with speed set at 25/3 Mbps

• • Bandwidth consumption continues to increase steadily.

• • 27% of private sector establishments have some or all employees teleworking.

• • More devices connect to home networks.

• • More teleworking and telehealth.
• FCC has discussed if they should adopt a universal service goal to help address affordability.  The USF is 26 years old and with changes from the original intent, they are looking nationally at a major rehaul of the program.

• It is likely that states will try to award all BEAD grants in 2024 (although it is questionable whether it is even feasible for states to meet the 1-year NTIA requirement) but will unlikely have any BEAD construction completed in 2024.

• RDOF winners are required to have 40% of the RDOF construction completed by the end of 2024.  If providers have not met this requirement, they will be in default, but it will probably be too late for BEAD funding.

• In-kind contributions for BEAD grants will be one of the ways to lower the cost of grant and increase use of non-cash benefits.  

• • In-kind matches can be provided by the grant applicant or by 3rd party, perhaps through local government.

• • BEAD allows the following costs that might be considered as an in-kind match (can be changed by the states):

• • • Employee or volunteer services

• • • Equipment

• • • Supplies

• • • Indirect costs

• • • Computer hardware and software

• • • Use of facilities

• • • Access to rights-of-way

• • • Pole attachments

• • • Conduits

• • • Easements

• • • Access to other types of infrastructure

• BEAD Program – even with the requirements established by NTIA for the BEAD grant program, there will be 50 different state programs and they can vary considerably.  For example:

• • Georgia

• • • Will only accept grants in first round that offers to build fiber.  The second round will be open it up to other technologies.

• • • Rewards ISP’s who propose to build out an entire county.

• • • Give 50 of 100 points based on amount of grant requested per location (the more matching funds the more points awarded)

• • Illinois

• • • Give 25 of 100 points based on amount of matching funds.  To get the full 25 points ISPs must cover 60% of the cost of the project.

These two states have very different priorities and scoring criteria.  It will be interesting to see what NTIA is going to be willing to approve.

• NTIA has a dashboard that shows the status of states BEAD grant programs – https://www.internetforall.gov/bead-initial-proposal-progress-dashboard

• Change in Line of Credit requirements for BEAD grants.

• • In addition to the line of credit letter (if used), provider must also get a bankruptcy opinion letter stating the LOC will be exempt if the provider files for bankruptcy.  This is outside the norm and may be difficult to obtain.

• • If obtain the 100% performance bond, the bankruptcy opinion will not be required.

• • Still possible that the 100% performance bond may be as expensive as the line of credit (yet to be determined).

• • Must have proof of performance bond at time of application.  This is not a typical operating procedure when it is theoretical that the grant will be awarded.  

• • NTIA allows the LOC of performance bond to be reduced as construction is completed but again, this is not a typical operating procedure and may increase cost due to additional reviews and requirements.

• Different sources talk about the “broadband gaps” of the digital divide and vary from 4 to 7. 

• • Source that showed the 7 gaps identified the following:

• • • Rural areas gap – with all the current federal funding this gap will be reduced (the forecast is that 989-99% of all US locations will have fiber or cable of at least 100/20 Mbps after the BEAD funding)

• • • Affordability gap – there needs to be a sustainable revenue stream.  There now is the ACP program but the future in questionable.  It will be necessary to continue to provide a baseline of support for low-income individuals.

• • • Operating gap – especially for high-cost rural providers.

• • • Adoption gap – this will require on-going training programs.

• • • Institutional gap – this is relating to schools, libraries and rural health facilities (2 of these receive assistance from the universal service fund but this fund is on shaky ground)

• • • Cable/copper gap – this relates to the outcomes of this type (as well as wireless) as opposed to cable/fiber.

• • • Utilization gap – this relates to how we are currently using the network to how we could be using the network to improve our uses and purposes.

• • Source that showed 3 gaps identified the following:

• • • Rural broadband – both availability and affordability

• • • Urban affordability – available but not affordable

• • • Competition gap – most places in US have only 1 ISP that can deliver 100/20 + Mbps.

• The 3rd quarter OpenValut measures the growth of broadband usage in the US.  Recently they released a comparison of monthly gigabytes usage for 3rd quarter 2023 with previous years as follows:

• • 3rd quarter 2019 275.1 monthly gigabytes

• • 3rd quarter 2020 383.8 monthly gigabytes

• • 3rd quarter 2021 433.5 monthly gigabytes

• • 3rd quarter 2022 495.5 monthly gigabytes

• • 3rd quarter 2023 550.2 monthly gigabytes

To put these numbers in perspective, in the 3rd quarter of 2023, the average US household used 54.7 gigabytes of data than one year earlier which is a lot of usage in a month.  With roughly 120 million residential broadband subscribers this equates to over 6.5 billion more gigabytes of data used each month than just a year ago.  That is 11% more usage hitting the internet backbone, just from residential usage.

• ACP will not be available forever.  States need to begin discussions of a backup plan to make broadband affordable once ACP is no longer funded federally.

• CAF Funding

• • $10B spent through 2021.

• • 93% households received only 10/1 Mbps (does not even count as broadband under today’s definition so areas receiving this funding will be eligible for BEAD funding.  Wasted federal dollars or duplicate funding, whatever it is called.  

• • CAF II reverse auction had the requirement of 25/3 Mbps.
• A group of RDOF awardees have filed an emergency petition with FCC for extra funding or other relief options.  To date, FCC has not been receptive to the requests.