Trump builds a virtual wall to fence high tech companies in


© Yann Forget / Wikimedia Commons, via Wikimedia Commons

Broadcom will not buy Qualcomm, and will not become the third largest chipmaker in the world, behind Intel and Samsung. Not because the eye watering price – $117 billion, the largest such high tech transaction ever – is too high. Not because the deal doesn’t make economic sense. It’s because U.S. president Donald Trump says it will harm U.S. national security.

Using his authority to define what national security needs are and squash transactions that threaten them, Trump categorically blocked Broadcom’s Singapore-based corporate parent and its Californian affiliate from buying San Diego-based Qualcomm.

The apparent worry is that technological and market leadership in 5G mobile chipmaking will leave U.S. shores and go overseas, to Broadcom and China-based Huawei, with the result that neither U.S. consumers or the military would be able to trust fundamental technology and products in the coming decades.

Trump didn’t pull this idea out of thin air. In February, six intelligence agency chiefs told the U.S. senate intelligence committee that people in the U.S. shouldn’t use mobile phones made by Huawei or ZTE, the number two Chinese manufacturer. According to CNBC, FBI director Chris Wray spoke for the group and said…

We’re deeply concerned about the risks of allowing any company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks.

The irony is that the FBI’s values include the belief that it should have a back door to the contents of any mobile phone or computer, and its sister agency, the NSA, has spilled malware into the cyber ecosystem.

There are good reasons to wish Qualcomm remains Californian and independent, not least because companies do not become more innovative as they get bigger. Quite the contrary. But technological leadership and prosperity cannot be guaranteed by walls that keep investors and immigrants out and companies in, or by government management of the high tech economy.

FCC will have to defend net neutrality repeal in San Francisco


The luck of the draw means the future of network neutrality and broadband’s status as a common carrier service will be argued in San Francisco. Credit for that is split between the California Public Utilities Commission and Santa Clara County, who filed separate challenges to the Federal Communications Commission’s decision to eliminate net neutrality rules and scrap common carrier obligations for broadband service with the ninth circuit federal appeals court.

Several other organisations filed their appeals in Washington, D.C., and a federal judicial panel randomly gave the job of consolidating and deciding the cases to the San Francisco-based ninth circuit.

Both the CPUC and Santa Clara County call the FCC’s decision “arbitrary, capricious, and an abuse of discretion” and claim that it violates both the federal constitution and federal communications law. In other words, they’re challenging the way the decision was made rather than its substance. That’s an easier – which is not to say easy – case to make. Republican commissioners rushed the decision through, and might not have dotted all the i’s and crossed all the t’s. To put it mildly, democratic commissioner Jessica Rosenworcel certainly thinks so – she called the FCC’s action a “rash decision” resulting from a “corrupt process”…

This decision and the process that brought us to this point is ugly. It’s ugly in the cavalier disregard this agency has demonstrated to the public, the contempt it has shown for citizens who speak up, and the disdain it has for popular opinion. Unlike its predecessors this FCC has not held a single public hearing on net neutrality.

There’s no shortage of Californians involved in the challenges to the FCC’s decision. California attorney general Xavier Becerra joined the appeal filed by his New York counterpart. Mozilla filed its own challenge. The Open Technology Institute and the Coalition for Internet Openness did too. Both list several Silicon Valley companies as major backers. OTI counts Google and Apple among its contributors (as well as Comcast and Charter, although I doubt this is what they signed up for).

CPUC vs. FCC, petition for review of order of agency, board, commission, or officer, 22 February 2018
County of Santa Clara vs. FCC, petition for review, 22 February 2018
Coalition for Internet Openess, petition for review, 5 March 2018
U.S. judicial panel on multidistrict litigation, in the matter of restoring internet freedom, consolidation order, 8 March 2018

Unanimous dig once vote puts broadband conduit in federal highway plans


Broadband infrastructure, and service providers, will have to be included in planning done for federally funded highway projects if, as expected, the U.S. senate goes along with a bill – house resolution 4986, aka the Ray Baum act – passed by the house of representatives last week. State transportation departments wouldn’t be required to include conduit and other telecoms facilities in projects, but they would have to share their construction plans with broadband companies and other state and local agencies, and do a minimal amount of coordination. The goal is “to facilitate the installation of broadband infrastructure” and “minimise repeated excavations” in roadways.

It’s a weak dig once program, but it’s a step in the right direction. It won’t have much impact in California because pretty much all of what’s required in the federal bill is already done here. Caltrans has a broadband notification and coordination program in place, the result of assembly bill 1549, which passed two years ago. At most, the program might need some minor tweaks if the federal bill passes.

HR 4986 covers a wide array of other broadband issues. It funds the Federal Communication Commission’s budget for the next two years and fiddles around with some job descriptions, programs and tasks. It also bundles in some of the Mobile Now act which, besides the dig once requirements, includes a plan to free up 255 megahertz of spectrum for broadband service – on both a licensed and unlicensed basis – and points the FCC toward allocating even more spectrum in the 3 GHz to 4 GHz and millimeter wave ranges for broadband uses.

Odds are HR 4986 will be approved by the senate. Broadband development is one of the few issues that republicans and democrats can agree on. The house vote to approve it was unanimous. It might be bundled into a massive federal budget bill that’s expected – or at least hoped for – later this month.

State lawmakers can do stupid things to the Internet too


State legislatures and governors are stepping into the void left by the Federal Communications Commission when it rolled back network neutrality last year. Laws reinstating net neutrality requirements of one kind or another passed or are pending in California, Washington, Oregon and elsewhere. In Montana, governor Steve Bullock did it by executive order.

That’s a trend that cheers up net neutrality advocates, but there’s another side to it that’s not so pleasant and offers a solid argument for keeping states out of the business of regulating the Internet. In at least two states – California and Rhode Island – legislators introduced bills that regulate Internet services on the basis on content.

Two democratic state senators in Rhode Island want ISPs to block pornography, although users would be able to pay a $20 fee to unblock it.

In California, it’s politics that has assemblyman James Gallagher (R – Chico) all hot and bothered. He thinks “social media Internet web sites” and search engines should be politically neutral. At least as he understands the concept. So he introduced assembly bill 3169, which would make it illegal for a social media platform or search engine to remove or manipulate content “on the basis of the political affiliation or political viewpoint of that content”.

Gallagher defines social media broadly. It includes, but isn’t necessarily limited to, “videos, still photographs, blogs, video blogs, podcasts, instant and text messages, email, online services or accounts, or Internet Web site profiles or locations”.

Both his bill and the Rhode Island measure are on a collision course with the First Amendment, which exists to prevent politicians from using the coercive power of government to control what content is published. Or not.

It doesn’t look like he’s done any deep thinking on the subject. It’s possible – likely, I’d guess – Gallagher knows his bill has zero chance of becoming law and just wants to score some cheap points with his political base. It’s a particularly noxious way to do it, though.

Wyoming’s legislature bows to telco, cable lobbyists, but not as deeply as California’s


Following California’s lead, Wyoming lawmakers grabbed their ankles and took what cable and telco lobbyists gave them: a law that subsidises broadband infrastructure, but only to the extent that incumbents want. Even so, Wyoming is not buying into the 1990s service levels that lobbyists for Frontier Communications, AT&T, Comcast and Charter Communications bribed convinced Californian assembly members and senators to accept.

As described by Phillip Dampier in Stop the Cap, what started out as an effort to give communities the option of pursuing their own broadband projects turned into an incumbent right of first refusal, secretly rewritten by lobbyists for Charter and CenturyLink. Which prompted a sharp response from Cheyenne mayor Marian Orr…

The substitute bill is substantially different than the original bill. And it wasn’t posted on-line or anywhere for anyone except insiders to have access to. CenturyLink and [Charter] are bullies. It’s wrong, and they are hurting Cheyenne and other WY communities from gaining affordable access.

Orr pushed back, but it wasn’t enough. According to Karl Bode, writing in DSL Reports, Wyoming legislators approved the bill this week.

That said, Wyoming’s legislators did not completely prostrate themselves, as California’s did. If no private ISP is interested in serving a Wyoming community, even with subsidies, then a local government can step in.

Perhaps even more importantly, Wyoming’s residential broadband standard is pegged at 25 Mbps download and 3 Mbps upload speeds. That’s equal to the federal agriculture department’s minimum for rural communities, and the Federal Communications Commission’s benchmark for “advanced services” capability. In larger communities, the standard for business service is even higher – 50 Mbps down/5 Mbps up.

California’s lawmakers thought that was too generous. Blindly accepting the campaign cash poor mouth arguments offered by AT&T, Frontier and cable companies, they decided last year that 6 Mbps down/1 Mbps up is good enough for every Californian.

State of Wyoming, Senate File No. SF010, Economic diversification-broadband services

The State of Washington takes on Washington, DC with its own net neutrality law


The State of Washington is the first to enact a network neutrality law. Washington governor Jay Inslee, a democrat, signed the bill on Monday. Both republicans and democrats voted in favor, with the bill winning lopsided majorities in the Washington house and senate.

The core language tracks with the former FCC’s three bright line rules, as well as similar legislation introduced in California. Internet service providers would not be allowed to…

(a) Block lawful content, applications, services, or nonharmful devices, subject to reasonable network management;
(b) Impair or degrade lawful internet traffic on the basis of internet content, application, or service, or use of a nonharmful device, subject to reasonable network management; or
(c) Engage in paid prioritization.

There is an exemption allowing ISPs “to address the needs of emergency communications or law enforcement, public safety, or national security authorities”, and to enforce copyright laws or block illegal activity. It also requires ISPs to disclose network management practices on “a publicly available, easily accessible web site”.

Assuming it’s not blocked by a federal judge – not a particularly good assumption – Washington’s law will take effect on 6 June 2018, but only if the FCC’s decision to roll back federal net neutrality rules is also in effect by then.

At that point, state and federal law will collide head on. The FCC’s decision nominally preempts any end runs by state legislatures. On the other hand, it gives the broadband cop job to the Federal Trade Commission and observes “that all states have laws proscribing deceptive trade practices”. Washington’s law takes advantage of that opening and defines blocking, throttling or paid prioritisation as “an unfair or deceptive act in trade or commerce and an unfair method of competition”.

It’s hard to imagine that’ll be enough to put states in the business of regulating broadband service, but who knows? The only sure bet is that the next chapter of this story will be written in court.

FCC considers clearing a path through federal reviews for small cells


Small cell sites and similarly sized wireless facilities will be able to skip federal environmental and historic preservation reviews if, as expected, the Federal Communications Commission okays new rules at its meeting later this month. As drafted, the FCC report and order would exempt “small wireless facilities” from studies and paperwork required by the National Environmental Policy Act and the National Historic Preservation Act. Those requirements were established many years ago, when the assumption was that a cell site was a big tower with lots of big antennas – what’s called a macro cell site today.

The FCC’s definition of a small wireless facility is specific – and generous – in some respects, but vague in others. Poles could be at least 50 feet, but if taller then no more than 10% higher than existing structures. Any single antenna could be no more than three cubic feet – suitcase size – but there’s no limit on the number of antennas. Nor on the amount of other equipment that can be installed, except that it can be “no larger than necessary for the operation of the small wireless facility”.

Facilities that fall within these specs would only be exempt from federal environmental and historical reviews – the FCC carefully notes that “small wireless facilities deployments would continue to be subject to currently applicable state and local government approval requirements”. That includes the California Environmental Quality Act as well as city and county permitting criteria.

That’s just for now, though. The FCC is listening to mobile carriers and big telcos and cable companies, which dominate its broadband deployment advisory committee. They’re meeting again next month, and could finalise recommendations for preempting state and local reviews, as well as a de facto ban on municipal broadband systems. The FCC isn’t obligated to accept those recommendations, but at least one member of the commission’s republican majority – Michael O’Rielly – is positively giddy at the prospect.

Eliminating unnecessary reviews is an excellent idea, and the FCC’s draft does a good job of injecting some common sense into federal regulations. Which is what the FCC is supposed to do. State and local governments have their own jobs to do, too. The FCC should leave them to it.

Wrangling over electric company fiber continues at CPUC


Both Southern California Edison and TURN, a consumer advocacy group, are lobbying the California Public Utilities Commission in the hope of pressing home their respective arguments about how much money generated from telecoms services, such as dark fiber leasing, privately owned electric companies can keep. The narrow issue that’s on the table is a master fiber lease agreement between SCE and Verizon that needs to be approved by the CPUC, but it could have far reaching effects on how, or even if, electric companies pursue telecoms opportunities and ultimately on the availability of independent long haul dark fiber in California.

SCE met with commissioner Clifford Rechtschaffen last month, before he pulled his proposed decision off the commission’s agenda last week. As drafted, it would require SCE to give 75% of gross fiber leasing income to its electric customers, rather than the 10% that’s currently required. SCE told Rechtschaffen that “the proposed 25/75 shareholder/ratepayer revenue sharing mechanism would cause SCE to not pursue any opportunities under the [Verizon master lease agreement] because they would not be economically feasible”.

TURN made its case in a conference call with Rechtschaffen’s staff, saying that there’s no support for the claim that reducing SCE’s cut from 90% of gross revenue to 25% will discourage future investment. That’s an odd point to argue. When you take expenses into account – which all have to come out of that remaining 25% – there’s not much left over to generate a return on investment for shareholders. No return means no investment. No investment means no more competitive dark fiber will be built. Which perfectly suits the monopoly-centric business models of California’s major long haul fiber owners – AT&T, CenturyLink and, yes, Verizon.

There’s no way of knowing at this point if Rechtschaffen plans to make any changes to his draft, or if at least two other commissioner will go along with it at their next meeting on 22 March 2018.

My clients include Californian cities that have municipal electric utilities with fiber interests, and cities that just want better broadband. I am not a disinterested commentator. Take it for what it’s worth.

Truth is the first casualty of small cell deployments


Mobile broadband companies are increasingly getting it when it comes to aesthetics, but pledges made on the front end aren’t always fulfilled by construction and operations staff or backed up by management. Wireless lobbyists and public relations people understand that they need to speak the right words to massage away concerns about how small cell installations will look as they proliferate along urban and suburban streets. But those oh-so-sincere promises, accompanied by beautifully rendered conceptual drawings, don’t always survive the descent into contract language, let alone appear on poles.

The City of Santa Rosa learned this lesson from Verizon – the hard way, according to an article by Christi Warren in the Press Democrate

The equipment — including large metal in-ground utility boxes about 5 feet tall — varies greatly in design from anything the city was previously shown by Verizon, the wireless provider installing the antennas, said Eric McHenry, director of Santa Rosa’s Information Technology Department.

While the city had no role in the equipment design, Santa Rosa officials went through a significant amount of back-and-forth with representatives of the wireless carrier on what the units would look like on city-owned streetlights, McHenry said. Officials took pains to make sure the antennas would be as unobtrusive as possible, he said.

“We frankly as a city were also surprised by what these first ones looked like,” he said, referring to the units Verizon is installing on utility poles. “They look nothing like what we had discussed with Verizon for our city streetlights or even the pictures that we shared with the council (of the installations) on wooden poles.”

The mobile companies have figured out that talking a good aesthetics game is tactically wise, but it’s a position that changes rapidly as rhetorical fights cool down. And once burned, city governments are very reluctant to make the same mistake twice.

That means there’s very little trust between cities and mobile companies, with good reason: the truth can be in short supply. The people tasked with making the case for wireless facilities might just be repeating what the boss said to say. City staff and policy makers can’t assume that companies will ultimately keep those promises because, as Santa Rosa found out, they often don’t.

CPUC not ready to cripple dark fiber competition just yet


No decision so far from the California Public Utilities Commission regarding changing the rules of the game for privately owned electric companies when they engage in dark fiber leasing and other telecoms business activities. The commission was scheduled to vote Thursday on a draft decision that, as currently written, would require Southern California Edison to give 75% of the gross revenue it gets from leasing out dark fiber to its electric customers. Up until now, it’s only had to hand over 10% of gross telecoms revenue to ratepayers.

The vote was bumped two weeks, to 22 March 2018. It’s the second time it was delayed. The first time, CPUC president Michael Picker pulled it off the agenda – any commissioner is allowed to do that once for any particular item, usually. This time, it was commissioner Clifford Rechtschaffen who asked for the delay. He’s the “assigned commissioner” in this case, and he’s the one who opened up what was originally a routine request by SCE to approve a master fiber lease deal with Verizon, and turned it into what could end up being a much broader reevaluation of how telecoms businesses of private electric utilities are regulated.

SCE and consumer advocacy groups – who have a strangely narrow view of what consumers need – continue to press their respective points of view, and changes might still be made to the draft decision.

Both SCE and Pacific Gas and Electric installed fiber networks on their electricity transmission infrastructure, originally to manage those systems. Installing a couple of fiber strands costs virtually the same as installing a couple of hundred, while going back and adding more strands later effectively doubles the cost. So network operators, of any sort, routinely add extra strands – usually lots of extra strands – when building new fiber routes.

PG&E and SCE were no different. Over the past twenty years or so, they’ve leased out extra capacity to other telecoms companies, and turned it into a nice side business run according to rules established by the CPUC back when it all started. They’ve also built extensions to their original fiber networks, to serve telecoms customers. Fiber built to support electric operations was treated as an allowable expense by the CPUC, which regulates electric rates partly on that basis, but extensions for fiber customers were not.

Up until now, it’s been a win-win scenario for electric companies and consumers, who need affordable broadband access as much as they need electric service. PG&E and SCE are major source of independent, long haul dark fiber capacity in California, which is a segment of the broadband market that woefully lacks competition, as the CPUC has acknowledged.

Reducing the incentives for them to compete would be a very bad decision.

My clients include Californian cities that have municipal electric utilities with fiber interests, and cities that just want better broadband. I am not a disinterested commentator. Take it for what it’s worth.