Chapter 2: Factors bringing about and prolonging America’s Telecommunications Infrastructure Crisis
"You can always count on Americans to do the right thing - after they've tried everything else."
-- Winston Churchill
Factors leading to the crisis
For more than a generation, American telecommunications policy has been focused on the wrong thing: bandwidth (broadband) instead of building fiber infrastructure to replace copper telephone lines that reach nearly every doorstep. Consequently, the United States wasted a quarter century in failing to adopt policies to support an aggressive and timely revamp of its telecommunications infrastructure from metallic cable to support legacy telephone and cable television services to fiber to the premise (FTTP) infrastructure to support Internet protocol services.
The country is also misconceiving advanced telecommunications infrastructure myopically, viewing it as a community level challenge when in fact it's a national one since it occurs all across the nation. Modern digital telecommunications infrastructure is fundamentally interstate, connecting states to each other and the nation to the rest of the world via the Internet. Unless it quickly changes course, the United States is likely to spend the coming years responding to these failures with incremental, local fiddling at the edges leading to more failure and disappointment.
Too many Americans remain embarrassingly served by 1990s DSL over aging copper lines, satellite Internet and even dialup. Most homes lack fiber connections and there's no coordinated national effort to modernize America's aging and outdated legacy metallic telecom infrastructure to fiber.
A national crisis
America’s advanced telecommunications infrastructure gaps are not an inherently local problem. They occur all over the United States – in urban, suburban, exurban and rural areas. It is a nationwide issue requiring a national solution. A major impediment to addressing this issue from a national or regional perspective is telecommunications is typically conceived of as a local service offering rather than infrastructure that links localities to other localities, regions and states and nations – the way long distance telephone service did for decades. The root of this conceptualization has both old and new origins.
The old one is cable TV service. Cable got its start in the 1950s as definitively local service, serving localities that for reasons of distance and terrain could not reliably receive broadcast television signals. Cable providers erected large antennae to pick up and amplify the signals, delivering them over cables to homes. Hence its designation as CATV service -- Community Antenna Television.
Local governments saw CATV – later fed with satellite delivered TV programming – as a local service and issued franchises to cable operators. Cable thus became to be thought of as a local service that varied from locality to locality.
The newer conceptualization of advanced telecommunications as a local service comes courtesy of legacy telephone companies that delivered voice phone service over twisted pair copper for many decades starting early in the last century. Starting in the late 1990s, telephone companies began providing Internet connections via Digital Subscriber Line (DSL) service.
DSL is hyper local because of its limited technological range, able to reliably serve customer premises only within about two and a half miles of phone company central office facilities or field distribution equipment. DSL also requires copper telephone cable that’s in good condition, another limiting factor to DSL’s reach given in much of the county, it as well as the aging utility poles that support it were put in the mid-20th century. (Telephone companies asked regulators to allow them to retire their old copper plant starting around 2010, but have put forward no plan to replace it with FTTP.)
Consequently, localities ended up with some neighborhoods able to get DSL service while others too far from these facilities could not. That further reinforced the conception of advanced telecommunications as a highly localized service.
Then around 2005, cable providers began offering Internet protocol-based voice and data services. Cable companies operate under franchise agreements with local governments. They realized local governments could require them to upgrade and build out their infrastructures to offer these advanced telecommunications services to all customer premises in a given local jurisdiction.
Wanting to avoid the capital expenditures entailed with that and to continue to cherry pick neighborhoods seen as having good profit potential, the cable companies championed state legislation that took franchising authority away from the locals and transferred it to state public utility commissions. Consequently, as with phone company DSL service, some neighborhoods are served while others not in cable companies’ desired service area “footprint” remain unserved
Viewing advanced telecommunications as a local service offering – priced, advertised and sold in service bundles – naturally leads to an unrealistic expectation that it should be a competitive market like other services marketed and sold locally. That leads to expectations like this:
“If Company X won’t serve my home or neighborhood, then shouldn’t I be able to go to Company Y or Company Z to get service? If Provider A doesn’t offer the service bundle at the price I can afford, then I should be able to shop Providers B, C and D for an alternative offer.”
The problem is these service offers aren’t available because the other providers aren’t necessarily in the market, their mass media advertising notwithstanding. The fine print in the ads from the legacy telephone and cable providers notes that service is “not be available in all areas.” That’s because in much of their nominal service areas, it costs too much and is too economically risky to support those other options under the dominant business model where the provider owns the infrastructure connecting customer premises that pay using recurring monthly subscriptions.
The business risk is not enough premises will subscribe or too many that do will close their accounts to justify the investment in high cost infrastructure. Any new providers who might compete with the incumbent providers face that same risk and more since they would have to woo away customers from the incumbents as well as get their own.
That business case risk is unlikely to change if advanced landline telecommunications remains largely unregulated on a de facto basis and left to large, investor-owned legacy telephone and cable companies. They’re not promoting their ability to connect more and more customer premises and there is no regulatory policy that compels them to do so. Lately, their ads promote sports and entertainment content -- for the premises they choose to serve with landline infrastructure -- and for mobile devices.
Public policy failure
In 1996, Congress and the Clinton administration foresaw the shift toward digital Internet protocol-based telecommunications and enacted an update of the 1934 Communications Act. The Internet was emerging as an exciting new digital technology available equally to all Americans via dialup modem over copper phone lines. Trademark American optimism held that technological progress would improve Internet access, uniformly lifting all boats and benefiting all American households like voice telephone service before it. A bold new digital future kicked off the previous decade with the mass market microcomputer beckoned.
The Telecommunications Act of 1996 defined "advanced telecommunications capability" as capable of delivering "high-speed, switched, broadband telecommunications capability that enables users to originate and receive high-quality voice, data, graphics, and video telecommunications using any technology."
For the existing legacy telephone companies with existing investment in legacy copper cable designed to support analog voice telephone service, that translated to an optional service upgrade – not a basic service available to all residences like voice telephone service was before it.
No national infrastructure standard, no deployment timeline
Notably, the law’s language of “any technology” did not define an FTTP infrastructure standard. Instead, the 1996 Act’s aspirational “high quality” service standard led to decades of debate over what technology and how much bandwidth could deliver “high quality” service as bandwidth demand grew exponentially.
Nor did the Act set a timeframe for the universal deployment of infrastructure capable of delivering advanced telecommunications. It merely required deployment to all Americans in a reasonable and timely fashion, leaving it up to the Federal Communications Commission (FCC) to determine if that level of deployment was occurring based on annual reports filed by telephone companies.
Instead of...