It’s hard enough just with apples.
Measuring where broadband needs are and setting priorities for meeting them is an objective, quantitative process for many regional broadband planners in California, while others focus on qualitative assessments. Representatives from fourteen regional broadband consortia met for two days in Sacramento earlier this week, largely to talk about how the California Public Utilities Commission should set priorities for spending subsidy money on broadband infrastructure projects in the state.
There was no single approach presented that works everywhere. What’s needed and important in tightly packed urban Los Angeles communities is different from priorities in the sparse rural expanse of, say, Mono County. But the immediate problem was to find common factors that could be compared on an apples to apples basis, and it’s difficult, if not impossible, to do that on the basis of compelling anecdotes or the noise level at community meetings.
So at the end, it was the numbers that mattered most, particularly those that measured the number of people and households that projects would reach, the social impact – poverty levels, household income, public institutions, for example – and the potential for building economically viable broadband systems. Business feasibility metrics included demographic factors, such as population density, physical fundamentals, such as whether or not middle mile backhaul is available, and financial capability.
As the priority-setting process moves into the next round, regional consortia will be gathering statistics for CPUC staff to crunch. We have a head start on that work here on the central coast. The eventual decision is in the hands of the five CPUC commissioners, who will be writing new rules and, perhaps, priorities for the California Advanced Services Fund broadband infrastructure subsidy program in the May – July time frame.
The two thousand mile, $120+ million Golden Bear middle mile fiber network is officially dead. Snaking through the canyons and river valleys of far northern California, the project was touted as a way of bringing fast, inexpensive backbone connectivity to areas far removed from bandwidth-rich regions to the south.
Effectively, backers were asking for 100% grant funding from the California Advanced Services Fund (CASF). Nominally, the limit is somewhere between 60% and 70%, depending on the level of broadband service, if any, that is available. There’s at least some support on the commission for popping that limit, at least for a middle mile project that lights up economically disadvantaged areas, such as the Sunesys proposal in the Salinas Valley. But the rules also limit funding to areas where residents can’t get service that hits 6 Mbps download and 1.5 Mbps upload speeds, and there’s little enthusiasm for subsidising fiber builds on routes where it’s already available.
Golden Bear failed on both counts. According to a story in the Santa Rosa Press-Democrat, a flood of challenges from incumbent service providers such as AT&T, Verizon, Comcast and others forced the original plan to be scaled back to the point where it didn’t make technical or economic sense, so the backers pulled the plug.
There were other problems with the proposal, not least the lack of skin the backers were putting in the game. Originally, the applicants asked for $119 million from CASF to pay what was positioned as 90% of the cost of building about a thousand miles of fiber and leasing another thousand. But it soon became apparent that the 10% match was conceptual: in kind contributions at best. Although details were closely held, the total cost to CASF was believed to have climbed into the $140 million range.
It’s not a total failure, though. Past experience with grand fiber plans that don’t fly on the first try shows that the technical and business planning done and community support gathered can be leveraged for incremental, rational projects. To paraphrase Winston Churchill, it’s not the end or even the beginning of the end, just the end of the beginning.
Tellus Venture Associates assisted with several CASF proposals in the current round, including the Sunesys middle mile project, so I’m not a disinterested commentator. Take it for what it’s worth.
At the ready.
The next round of applications for broadband infrastructure construction subsidies from the California Advanced Services Fund (CASF) might be accepted on a rolling first come, first served basis, as soon as this summer. That was one of the options discussed this morning by California Public Utilities Commission staff at a statewide meeting of regional broadband consortia in Sacramento.
The CPUC is working on new rules for CASF grants and loans, to allow independent ISPs and local governments to participate in the program, as approved by the state legislature last year. If the current timetable holds true, the first draft of the new rules will be ready by May and finalised in July. At that point, the application window might be opened, and stay that way until the remaining money in the grant fund – call it $130 million – is allocated.
That’s different than the way it was done in the last round, when 30+ proposals were handed in on deadline, more than a year ago. Some are still being evaluated by the commission. Then, applicants had about a year to put together projects. This next time, though, communities and service providers who have planned in advance will have an advantage if the commission starts accepting grant and loan proposals on an open basis.
An open window will be an incentive for incumbents and challengers alike to quickly develop projects and submit applications. It could also help to unclog the review and approval process. All of which needs to happen, given the CPUC’s goal, in keeping with the wishes of the state legislature, to allocate the remaining money by the end of 2015.
More complicated than sending a note home to mother.
The first step in identifying broadband availability gaps in California is defining how much and where bandwidth is needed. Education is a major driver of bandwidth demand, particularly as new methods for measuring how well California’s children are being taught come into effect. That initiative – the so-called Smarter Balance Assessment – replaces pencil and paper tests with online computers. But the initial guidelines drawn up by education officials for estimating the broadband speeds necessary are too simplistic, according to California Public Utilities Commissioner Katherine Sandoval.
“That technical advice is psycho”, Sandoval said. The Internet speeds available to schools need to be fast enough to let students move through the tests as quickly as they’re able, otherwise “we’re testing broadband and not their brains”.
She was the keynote speaker at the second annual broadband consortia summit in Sacramento. In the afternoon, leaders from the 14 regional broadband consortia funded by the CPUC via the California Advanced Services Fund discussed how to identify which areas of the state have the greatest need for infrastructure construction subsidies.
I gave an overview of the analysis we’ve done in the Central Coast region. Some consortia took a similarly quantitative approach, others focused on what they saw as obvious needs. Connie Stewart, from the Redwood Coast consortium, used the availability of local matching funds – public or private – as a top criterion for setting priorities: projects won’t be built if the money isn’t there.
The Gold Country consortium, in the Sierra Nevada foothills east of Sacramento, has decided not to wait for CASF subsidies. Randy Wagner, its new executive director, brought along four local wireless Internet service providers that he introduced as “my best friends” and said their goal is to reach unserved communities – those with no access other than dial-up or satellite – within three to four months.
The summit wraps up tomorrow.
We found the money.
The California Advanced Services Fund (CASF) will be topped up to the $315 million limit set by law by mid–2016, thanks to a hike in a surcharge added to phone bills that was approved last week by the California Public Utilities Commission. But much of it is already spent or earmarked, so the amount available for broadband infrastructure construction grants is likely to be $130 million, plus or minus a few million, the next time the CPUC accepts applications.
Boiling it down, $10 million goes to a loan fund, $25 million to public housing facilities and marketing programs and $10 million to regional consortia, leaving $270 million for grants. Of that, about $52 million is for projects approved under older rules, including a $10 to $11 million spiff for the Digital 395 project approved last year.
So far, $30 million has been given to 11 projects in the current round of applications, which were submitted in February 2013, and the commission is scheduled to vote on 4 more totalling $12 million. Based on administrative costs approved to date and projecting forward a few years, the overhead hit will be north of $10 million. Call it $16 million.
Subtracting it all out leaves $150 million. If you assume the $120 million Golden Bear proposal is dead (as I do), 7 projects totalling $39 million are still on the table. But those attracted multiple challenges or have other problems, so there’s some uncertainty. I don’t know what the final figure will be, but if you call it half – purely for the sake of discussion – you end up with something like $130 million. Or somewhere in the $110 to $150 million range, if you prefer.
The CPUC’s goal is to approve spending all the grant money by the end of 2015, to hit a target set by lawmakers. But first the commission has to rewrite CASF rules yet again, also because of changes made last year by the legislature. That’s scheduled to be done in July, which will leave a year and a half for applicants to develop projects and submit applications, and for the commission to approve or reject them.
Where’s the fashion police when you need them?
Knee jerk calls to regulate virtual currencies, in order to protect us from a repeat of the total collapse of the Mt. Gox Bitcoin exchange this week, prove two things: 1. there are people in Washington (and, I wager, Sacramento) who must do nothing all day except see what’s trending on Twitter and paste top tweets into boilerplate bills, and 2. there’s a dangerous misconception that personal online behavior can be regulated. Intercepted, investigated, penalised, monitored, blocked, taxed and subsidised, yes. Run according to wise rules cleverly designed to lead us all to one vision or another of the Common Good, no.
Bitcoin’s purpose is to meet the needs of people who, for whatever reason, want to engage in unregulated transactions. There’s no shortage of talent aching to fill that need, whether for personal gain or in a quest for fame and status amongst fellow hackers, in the true and noble sense of the word. Regulate one solution and another will pop up.
In any event, Bitcoin’s fate will be decided by the market. If, as Marc Andreessen believes, the Mt. Gox eruption is just another step toward maturity, Bitcoin’s value and transaction volume will continue to climb. On the other hand, if there’s indeed a fatal flaw in the algorithm, then it’ll fade away. People will have lost wealth – more likely the product of Bitcoin’s rapid appreciation and the transactions it particularly enables than, say, heretofore prudent management of a pension portfolio – but it’ll be because they either accepted or ignored (if there’s a difference) or, perhaps, enjoyed the risks involved.
Better to guarantee regulatory success by sticking to predictably beneficent crusades. You know, like network neutrality.
No one picked up the phone until a bullet hit a PG&E transformer.
More than ten months on, the motive and people behind fiber cuts and gun shots south of San Jose last year are still a mystery, according to a briefing given to the California Public Utilities Commission yesterday. The incident happened on 16 April 2013, knocking out Internet service to thousands of AT&T customers. A PG&E substation was also damaged, although no power outages resulted.
Ray Fugere, from the CPUC’s safety and enforcement division, described the timeline of the attack. It began at 12:58 a.m., when an AT&T fiber line that runs along the railroad tracks that pass by the substation was cut. Nine minutes later at 1:07 a.m., a second line belonging to Level 3 was also severed. Fugere gave few details about those cuts, except that at the time, neither AT&T or Level 3 knew exactly where or what the problem was. All they could tell was that they had lost connectivity, so they didn’t call the cops or let anyone else know that something was wrong.
Half an hour later, though, someone started shooting at PG&E’s Metcalf substation, setting off a fence alarm and puncturing an oil-filled transformer. PG&E staff called 911, and ten minutes later a unit from the Santa Clara County sheriff’s office arrived on the scene. The fiber cuts and the shooting are believed to be related and the FBI is continuing to investigate.
Most of the presentation and subsequent discussion concerned how to improve security at critical energy facilities, but the telecoms companies involved were chided for their silence. Commissioner Katherine Sandoval pointed to a general “failure of imagination” and lack of coordination by utility companies as something that needs to be pursued, a conversation, she said, she’s looking forward to having.
It got a little harder to clear the bar today.
Local governments and independent Internet service providers can apply for broadband infrastructure construction subsidies from the California Advanced Services Fund (CASF), under new rules approved this morning by the California Public Utilities Commission.
There are pluses and minuses in the decision. On the whole, the commission is requiring these newly eligible application to meet requirements that are very similar to those imposed on regulated telephone companies, but without granting the same operational privileges – pole attachment and interconnection rights, for example. On the other hand, ISPs and local governments don’t have the burdens of complying with all the regulatory overhead – including allowing other carriers access to some of their own facilities – that goes hand in hand with that.
Today’s commission decision…
- Requires local governments and independent ISPs buy performance bonds to guarantee any project that CASF funds.
- Requires start-up companies (i.e. any provider that hasn’t been in the broadband business for at least a year) to have access to cash in the amount of 10% of a project’s cost, up to $100,000, a provision added in yesterday when the final draft was released.
- Requires them to agree to be bound by CPUC rules and subject to its penalties if they don’t comply with the terms of a grant or loan.
- Doesn’t differentiate between local governments and private companies in setting requirements, and doesn’t address the issues raised in that regard by The Utility Reform Network last month.
- Adds back in a previously deleted requirement that satellite-based applicants “prove functionality”.
There’s still work to be done, though, before the commission can start taking CASF project proposals from non-traditional applicants, including how to implement a right of first refusal given to incumbents by the state legislature last year and figure out how to parse the additional restrictions that were placed on local government. That’s scheduled to be done sometime this summer.
Not to Google spec either.
Google has handed a fiber-ready checklist to 34 cities in 8 states, including five in California. Not just anywhere in California, but smack in the middle of Silicon Valley. You’d think that if there was any metro area in the state that would zip through Google’s homework, it would be the likes of San Jose, Sunnyvale, Mountain View, Santa Clara and Palo Alto.
No need to guess, though. With Google setting a deadline of 1 May 2014 for cities to provide the information and accommodations requested, we’ll soon find out if there’s any hope for the Golden State.
What’s being asked is not coming from out of the blue. The three main items on the list are policies and practices that have been urged by broadband advocates and tech-savvy elected officials for years…
• We’re asking cities to ensure that we, and other providers, can access and lease existing infrastructure…
• We’re asking cities to provide accurate information about local infrastructure like utility poles, conduit and existing water, gas and electricity lines…
• We’re asking cities to make sure they have permit processes suitable for a project of this scale.
But general local willingness to adapt and and change with the times is not enough. Californian law makes it easy for small groups – even a single, dedicated individual – to tie up any kind of construction project for years. And if special interest groups and their political allies jump on an opportunity to shake down a giant corporation for goodies galore, it’s game over. Ask San Francisco how that works.
Or ask the man in charge of Google Fiber, Milo Medin…
We work with communities that make it easy for us. if you make it hard on us, enjoy your cable connection.
The latest rev of a regional broadband priority analysis for the Central Coast Broadband Consortium shows that Salinas Valley communities would see the greatest benefit from broadband infrastructure development, and be more likely to support viable projects.
These preliminary results add weight to the argument for building a fiber optic line through these towns and connecting them to Santa Cruz.
The top three communities by county and regionally are…
Monterey County: 1. Greenfield, 2. King City, 3. Gonzales.
San Benito County: 1. Aromas & surrounding area, 2. Airport/Northeast area, 3. Cienega Road area.
Santa Cruz County: 1. Pleasure Point and Twin Lakes (adjacent communities were combined), 2. Soquel, 3. Brookdale.
Regional wildcards – highest ranking communities not in a county’s top 3: 1. Soledad, 2. Castroville, 3. Chualar.
The six Salinas Valley towns that top the Monterey County and regional rankings are home to 71,000 people, 60,000 of whom live in areas that are CASF-eligible, or at least arguably so. That’s a big percentage of the total population, which adds to the economic and social impact of projects. They are packed tightly together – there are 7,600 people per square mile in Greenfield, for example. That’s a plus for broadband planning, at least in the narrow sense that the shorter the distance between homes, the less it generally costs to build infrastructure.
But it also points to poverty. Median income levels are low – ranging from $44,000 per household in Soledad to $66,000 in Chualar (and surrounding area, which brings the average up). Public service agencies organisations are potential customers, though with 70 potential locations.
The assessment is not finished yet. There’s an ongoing workshop on Civinomics.com where anyone – local or not – can talk about ideas for measuring the impact of broadband development and crunching the numbers. Maps and spreadsheets with all the data and formulae are there to be downloaded. Come and join us.