Cities can speed up pole attachments by new ISPs, federal judge rules

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The City of Louisville, Kentucky can impose one touch make ready rules on utility pole owners, and maybe a lot of other cities can too. A U.S. district court judge threw out AT&T’s challenge to Louisville’s pole attachment ordinance on Wednesday (h/t to Ars Technica for finding the ruling). It was passed in 2016 to help clear the way for Google Fiber to begin hanging cables on poles occupied by AT&T in Louisville

Before Louisville passed its ordinance, independent ISPs had to wait for incumbent telecoms companies, like AT&T or Comcast, to move or otherwise readjust their wires to make room for the new guy – in other words do the make ready work on their own stuff. Google complained that incumbents were stalling, in an attempt to block competition. The Louisville city council listened, and passed an ordinance that said that Google, or any other new ISP, could rock up to a pole and do all the necessary work – move existing wires and install its own – all at once. Without asking permission from incumbents.

According to the City of Louisville, that single-step – one touch – rule for make ready work was justified by Kentucky law which allows cities to manage public right of ways. And the judge agreed

The ordinance mandates a one-touch make-ready approach, and a one-touch make-ready approach inherently regulates public rights-of-way because it reduces the number of encumbrances or burdens placed on public rights-of-way. It is undisputed that make-ready work can require blocking traffic and sidewalks multiple times to permit multiple crews to perform the same work on the same utility pole. The one-touch make-ready ordinance requires that all necessary make-ready work be performed by a single crew, lessening the impact of make-ready work on public rights-of-way. Louisville Metro has an important interest in managing its public rights-of-way to maximize efficiency and enhance public safety.

AT&T can appeal the decision, but hasn’t said whether it will.

Because this ruling comes from a federal court, it could have implications in California, which, like Kentucky, directly regulates utilities in general and pole attachments in particular, rather than relying on the Federal Communications Commission to do it. California and Kentucky law differs, though, so it’s not a green light for cities here to follow Louisville’s lead. But there’s no red light either. Call it a flashing yellow: proceed with caution.

Legislators should aspire to meet Californians’ broadband expectations

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Higher broadband standards are a threat to legacy telephone companies, like AT&T and Frontier Communications, and to cable companies, like Charter and Comcast. But for different reasons.

When the Federal Communications Commission set the speed standard for advanced telecommunications services at 25 Mbps download and 3 Mbps upload in 2015, legacy telcos pushed back because their copper line systems couldn’t come anywhere near it, except in affluent, “high potential” areas where the short return on investment is high. You might think cable companies would have been happy, since they easily exceed that benchmark, but that wasn’t the case. Cable’s political action platoons immediately attacked it because they – rightly – feared being slapped with the monopoly label if consumers only had one choice for broadband service deemed sufficient by the FCC.

So far, cable and telco lobbyists haven’t been able to convince the FCC to dumb down the 25/3 standard, although the commission’s new leadership is seriously considering it. Instead, they’re denigrating the standard at every opportunity by calling it “aspirational”, rather than practical, despite the fact that it’s been adopted as the minimum level for subsidised rural service by the federal agriculture department.

They’re pushing the aspirational argument in Sacramento, as they flex their financial muscles and push friendly legislators toward lowering California’s broadband standards as well.

Assembly bill 1665 would drop the minimum acceptable level of broadband service in California to 6 Mbps download and 1 Mbps upload speeds, and funnel infrastructure construction subsidies directly to legacy telephone and, in some cases, cable companies. Independent projects, of the sort that have brought truly advanced fiber service to rural communities, would be locked out.

Those defending the bill, including non-profits hoping to tap what little money might otherwise become available, have taken up the aspirational meme, using it derisively when anyone points to the irrationality of dropping California’s already low broadband standard, instead of raising it to the level consumers need, and buy when they can.

The fate of AB 1665 will be determined in the next two or three weeks, once lawmakers return from their summer vacation. Californians’ legitimate expectations – for broadband service and legislative performance – should not and cannot be dismissed as mere aspirations.

No Halloween treat for CenturyLink-Level 3 deal in California

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CenturyLink’s proposed purchase of Level 3 Communications appears likelier than not to be delayed for months. Yesterday, the California Public Utilities Commission set a tentative schedule for completing its review of the deal, with a target date of mid-November. That would mean the two companies will have to agree to extend their self-imposed deadline of 31 October 2017 if they still want to complete the transaction.

That won’t necessarily be the case. The ruling issued by commissioner Martha Guzman Aceves yesterday is vague – in many respects – and leaves room for a faster decision. On the other hand, there’s nothing in it that would keep the process from dragging on longer.

The CPUC has to decide if allowing CenturyLink to buy Level 3 is in the public interest. Yesterday’s ruling appears to take a narrow approach to answering that question. The real problem with the deal – the damage it would do to telecoms competition in California – isn’t explicitly mentioned. Rather than taking a top to bottom look at all the issues involved, the scope of the enquiry is, for now, limited to the settlement that CenturyLink reached with some of the organisations that objected to the deal.

But not all of them. The California Emerging Technology Fund is actively opposing the settlement, arguing it doesn’t go far enough, and a VoIP company – Telnyx – jumped in at the last minute and could yet make its presence felt. So long as the transaction is being actively contested, it is difficult, if not impossible, to short cut the CPUC’s review.

There is virtually no chance that the CPUC will approve the deal before the end of September, an outcome that a CenturyLink lawyer, Norm Curtwright, last week called “almost too awful to contemplate”. The horror of blowing past Halloween must be beyond human imagination, but that’s the reality now facing CenturyLink and Level 3.

USDA embraces 25 Mbps broadband standard even as FCC dumbs it down

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Somebody knows when to crank it up.

The minimum acceptable broadband speed in rural areas is now 25 Mbps download and 3 Mbps upload. At least according to the federal agriculture department.

The Rural Utilities Service (RUS) offers loans to broadband providers – cooperatives and small telephone companies frequently tap the program – for service upgrades in areas that meet the agency’s requirements. One of those requirements deals with the speed and availability of existing service – if a provider is expanding into new territory, then at least 15% of the homes in that area must be “unserved”, as defined by RUS.

Originally, the RUS threshold for acceptable service was 4 Mbps down/1 Mbps up. If that level of service wasn’t available, then an area qualified as “unserved”. It’s periodically revised that definition, and for its latest broadband loan window, RUS has raised the bar

For the purposes of this [notice of funding availability], the agency is revising the definition of ‘‘Broadband Service’’, such that for applications submitted under this window, existing Broadband Service, the rate used to determine if an area is eligible for funding, shall mean the minimum rate- of-data transmission of twenty-five megabits downstream and three megabits upstream for both mobile and fixed service.

The new RUS rules also require any infrastructure that’s funded by its loans be capable of delivering service at those speeds…

With respect to the ‘‘Broadband Lending Speed’’, the rate at which applicants must propose to offer new broadband service is a minimum bandwidth of twenty-five megabits downstream and three megabits upstream for both mobile and fixed service to the customer.

It’s the same minimum that the Federal Communications Commission has set for advanced telecommunications services – high speed broadband, in other words. But ironically, while RUS raises its minimum, the FCC lowered its threshold for mobile broadband subsidies in rural areas to 5 Mbps down and no particular requirement on the upload side, and is considering dropping its advanced services benchmark to 10 Mbps down/1 Mbps up for mobile, and perhaps all, service.

RUS has it right.

Mobile-only and wireline broadband divide is about poverty, not usability

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Some people only have mobile broadband service, so that must be all they need. That’s the core argument that the Federal Communications Commission poses in its inquiry – and request for public comment – on what is the proper definition of advanced broadband services.

Right now the standard is 25 Mbps download and 3 Mbps upload speeds. Sporadic spurts and bursts aside, mobile broadband service doesn’t come anywhere near that level. So the FCC is considering lowering the benchmark and declaring mobile service that runs at 10 Mbps download and 1 Mbps upload speeds is as capable of supporting advanced services as wireline broadband that hits the 25/3 mark.

That’s nonsense on the face of it, and it completely falls apart when real people in the real world are considered. FCC commissioner Mignon Clyburn says the premise is false

We seek comment on whether to deem an area as “served” if mobile or fixed service is available. I am extremely skeptical of this line of inquiry. Consumers who are mobile only often find themselves in such a position, not by choice but because they cannot afford a fixed connection. Today, mobile and fixed broadband are complements, not substitutes. They are very different in terms of both the nuts and bolts of how the networks operate, and how they are marketed to customers, including both from the perspective of speed and data usage. I have heard from too many consumers who can only afford a mobile connection, and even then they have to drop service in the middle of the month because they cannot afford to pay for more data.

Even the 25/3 standard is too low, Clyburn says, noting that it “would not even allow for a single stream of 1080p video conferencing, much less 4K video conferencing”.

That’s what advanced services are supposed to be about. There’s nothing advanced about reading email or watching low-quality video or sharing a photo. Standards for the future shouldn’t be based on what was possible 20 years ago.

Mobile carriers say their broadband isn’t very fast, so FCC sets lower standard

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The Federal Communications Commission is on a mission to slow down broadband in rural areas. Or at least protect incumbents who don’t invest in their networks in rural markets where competitive options are few to non-existent.

The latest move approved by commissioners sets a low bar for mobile broadband service. Similar to its Connect America Fund program that subsidises fixed, mostly wireline service in communities with sub-standard Internet service, the FCC administers the Mobility Fund for mobile carriers. In order for qualify for subsidies under the plan reaffirmed by the FCC earlier this month, existing mobile broadband speeds have to be below 5 Mbps download, with no standard at all set for upload performance.

That’s in contrast to the wireline subsidy program, which sets 10 Mbps down and 1 Mbps up as the minimum. Rural carriers wanted the FCC to use the same standard for mobile service, and in the process make more areas eligible for subsidies. But the FCC didn’t buy it, arguing that they have to establish service levels that are “reasonably comparable” to what’s available in urban areas and, contrary to what they advertise, the big mobile carriers say they don’t do all that well…

Although [the rural wireless carriers group] claims that the median download speed provided by nationwide carriers is approximately 12 Mbps, Verizon counters that, depending on demand, consumers in an urban market may see service slower than 5 Mbps. Furthermore, despite the fact that providers have used different standards and methodologies to report coverage…the nationwide carriers are all generally reporting minimum advertised download speeds of 5 Mbps for their 4G LTE network coverage.

Other national mobile carriers, including notably T-Mobile, made similar arguments. It’s funny how they try to sell customers on blazing fast performance, and then turn around and trash talk it when it’s time to protect their poorly served rural turf from subsidised competition.

The Trump administration’s FCC is also considering lowering the standard for advanced service from the current 25 Mbps down/3 Mbps up level to 10 down/1 up, at least for mobile broadband, another move that would please big incumbent telcos and cable companies and help protect their monopoly business models.

Making much of the rural U.S. a competition-free safe zone for incumbents is the wrong thing for the FCC to do, and sanctioning lower broadband speeds at a time when demand is skyrocketing is the wrong direction to take.

AT&T gets a contract with California landline, DirecTv workers

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AT&T and the primary union representing its employees – the Communications Workers of America – finally crossed the finish line in their marathon negotiations in California and Nevada. The rank and file voted to approve the latest deal by a 58% to 42% margin. That comes after the first deal they struck was rejected by the membership in July, on a 53% to 47% vote.

According to Fortune, the deal was sweeter the second time around…

Like the original agreement, the revised contract included wage hike totaling 11% over four years and some job security promises, but also increased employees’ healthcare contributions to cover insurance premiums to 29% by 2020.

Since last year’s seven-week strike at Verizon (VZ, +0.08%) led to workers there getting a better contract offer, labor tensions have been rising across the telecommunications industry. Increasing healthcare costs and job security against outsourcing have been among the most difficult issues.

It was a long and difficult process, with the union and AT&T going 16 months without a contract. At one point in May, CWA members walked off the job for three days to protest the slow pace of talks. Wireless employees also joined that mini-strike, but they’re not covered by the agreement that was ratified this week – that only takes in landline and DirecTv workers. Negotiations on a contract for the wireless workforce continue.

It’s the first time that employees who came in to AT&T via the DirecTv acquisition have been covered by the contract. Bringing them in under the CWA/AT&T umbrella was just one of the challenges. Over the years, AT&T and CWA have built up a structure that treats different groups of employees differently, even ones that do similar, or in some cases largely identical, jobs. Those splits within the workforce were one of the major factors behind the rejection of the first contract in July.

If we dumb down standards, more people will have advanced broadband, says FCC

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The Federal Communications Commission is floating the idea of treating fixed and mobile broadband service as equivalents when it assesses whether or not people in the U.S. have access to “advanced telecommunications services. It’s an annual enquiry, and in 2015 it produced the useful benchmark of 25 Mbps download and 3 Mbps upload speeds as the minimum threshold for any given broadband service to be reckoned as advanced.

For now, the FCC is just asking for public comments on the concept, although given the weight afforded to lobbyists for AT&T, Comcast, Verizon, Charter and other major telecoms companies, don’t be surprised if comments from some members of the public are deemed, um, more equal than others.

The question posed by the FCC is whether fixed and mobile broadband are two different paths to the same, advanced telecommunications goals…

13 percent of Americans across all demographic groups are relying solely on smartphones for home internet access. Given that Americans use both fixed and mobile broadband technologies, we seek comment on whether we should evaluate the deployment of fixed and mobile broadband as separate and distinct ways to achieve advanced telecommunications capability. Taking into account the differences between the various services and the geographic, economic, and population diversity of our nation, we seek comment on focusing this…Inquiry on whether some form of advanced telecommunications capability, be it fixed or mobile, is being deployed to all Americans in a reasonable and timely fashion.

An inconvenient truth – also well explained by the FCC in last week’s notice – is that mobile broadband technology does not have the speed or the overall capacity to deliver data like wireline services can. But they also suggest a solution: lower the minimum standard for advanced services to 10 Mbps download and 1 Mbps upload for mobile, while keeping the fixed benchmark at 25/3.

That is an irrational and dangerous path to follow. Speed matters, and setting a lower standard for mobile service would mislead and ultimately disappoint anyone who was conned into relying on it because the FCC stamped an advanced services label on it. And it would only encourage lobbyists for AT&T, Frontier Communications and other telcos that are milking the last dollars they can out of decaying rural copper networks to make the same argument for wireline service.

Lowering standards in order to please incumbents with deep pockets and a habit of being generous to their Beltway friends would be a supreme disservice to the U.S. public and a dereliction of the FCC’s duty.

Big telecoms mergers could test Trump’s anti-trust chops

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There’s a lot of sniffing around telecoms companies in these dog days of summer. Softbank, Japanese tech investment giant which owns Sprint, is reported to be sniffing around T-Mobile, with a merger in mind. If it happened – if regulators allow it to happen – it would take the U.S. mobile telecom sector down to three companies, from the current four.

Charter Communications is getting a lot of attention, too. Softbank first tried to engineer a merger, and when that failed began talking about buying the company outright. But if it’s really in the hunt for T-Mobile, a second mega-deal with Charter becomes unlikely.

But it has company. According to a story on CNBC, Altice is looking at adding Charter to its U.S. kennel, which so far includes Suddenlink and Cablevision. It’s not much of a powerhouse in the U.S., yet, but the France-based company is a major player in Europe. If it wants to buy Charter, it has to entice controlling owner Liberty Media and its big dog, John Malone. The question, according to CNBC, is whether Altice’s track record of boosting the value of acquired cable companies by slashing operating expenses will do the trick…

In its short time operating in the U.S. market, Altice has shown a unique ability to cut costs and generate substantially higher margins, before taxes and other costs, than predecessor managements. But Liberty is still wary of taking Altice paper in the belief that it is too early to tell whether those gains are sustainable…

Charter, with $60 billion in debt and an expected purchase price that could reach or exceed $500 a share would represent an enterprise value of almost $200 billion.

Altice’s U.S. holdings may be small enough to avoid triggering a fatal anti-trust response from the federal justice department. In past times, a T-Mobile-Sprint combination probably would set off alarm bells – similar mergers did – but things might be different now. Conventional wisdom is that the Trump administration wouldn’t be so worried about increased telecoms market concentration, concerns about its treatment of the AT&T – Time Warner deal notwithstanding. We might know soon if that’s a good assumption.

No express lane offered for CenturyLink, Level 3 review at CPUC

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“I’m hoping there’s something more that the parties can do to prepare for a decision at a later date”, Regina DeAngelis, an administrative law judge with the California Public Utilities Commission, told lawyers for CenturyLink, Level 3 and a handful of organisations that have involved themselves in the regulatory review of the two companies’ plan to combine into one. She presided over yesterday’s pre-hearing conference at the CPUC’s San Francisco headquarters – the opening event of what could be an enquiry lasting several months.

Which is exactly what CenturyLink and Level 3 are trying to avoid. And what DeAngelis was warning might happen.

The deal they struck last October has CenturyLink buying Level 3 for $34 billion. In order for that to happen, they need to get approval from two federal agencies – the Federal Communications Commission and the justice department – and a couple dozen or so states that have chosen to play an active role in telecoms oversight. They gave themselves a year to finish those reviews and close the sale, but left the door open for extending it by mutual agreement. They also set 30 September 2017 – eleven months – as a benchmark date, when transaction costs begin to creep up.

So they’re trying to push the pace of the CPUC’s review. They started out by asking for commission approval by mid-September, but given mandatory public notice requirements – 30 days before commissioners vote on a proposed decision – DeAngelis threw cold water on that idea, saying “I can tell you that won’t happen”.

It doesn’t seem like two extra weeks will help much, either. That would require turbo-charging standard operating procedures and, as DeAngelis wryly noted, “this commission isn’t often known for moving that quickly”.

That’s particularly true when a merger or other major transaction involving regulated companies attracts formal protests. In this case, five organisations formally challenged it. Three settled their differences with CenturyLink – the CPUC’s independent office of ratepayer advocates (ORA) and two consumer groups, the Greenlining Institute and TURN. Lawyers for Greenlining and ORA were at yesterday’s conference, and endorsed CenturyLink’s push for a fast decision.

Two others are still in the fight, though. The California Emerging Technology Fund wants CenturyLink to spend more money in California, with its guidance, and VoIP provider Telnyx objects to what it says are plans to shut down Level 3’s independent wholesale business after the sale closes. With active third party opposition added to the CPUC’s responsibility to do its own due diligence, an expedited decision is not the way to bet.

The next step is for DeAngelis to issue a scoping memo, which be the roadmap and schedule for the rest of the proceeding.