Subsidise what we’re already doing, telecoms companies tell CPUC

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Give me the money!

Big telecoms companies don’t want California broadband infrastructure subsidies to go to potential competitors, and they don’t want to be pushed into spending any more capital on upgrades than they’ve already budgeted. AT&T, Frontier Communications and the cable industry’s California lobbying front took a defensive posture in comments regarding broadband development priorities drafted by the California Public Utilities Commission. It was in response to a staff white paper that took a first shot at a quantitative analysis of how to get the greatest benefit out of the roughly $60 million still available for infrastructure grants in the California Advanced Services Fund.

AT&T wants the CPUC to put middle mile projects at the bottom of the list and to turn a blind eye to last mile technology. The former is not surprising, since last mile competition flows from middle mile projects, and competition is the last thing that AT&T wants in rural and inner city markets where it has monopoly control. With that kind of dominance in rural and inner city areas, AT&T plans to rip out copper networks and replace them with wireless systems, which is why it wants the CPUC to look kindly upon that kind of technology. If it loses its monopoly grip, though, competition would severely dent, if not kill, its wireless local loop business model.

Both Frontier and the cable industry’s Sacramento lobbyists also want the CPUC to back away from funding potentially competitive projects, although they express it in terms of avoiding areas where promises have been made to eventually upgrade service or where federal programs will subsidise broadband infrastructure. Substandard broadband service, it should be noted. The 10 Mbps download/1 Mbps upload speeds allowed under the Federal Communication Commission’s program are below the CPUC’s current minimum, and far less than the FCC’s own 25 Mbps down/3 Mbps up standard for advanced service. Which is what the, um, California Advanced Services Fund is supposed to be about.

Rural telephone companies, aka small LECs (local exchange carriers), take a warmer approach to the CASF program overall, and had generally good things to say about the criteria and methodology used in the white paper. Echoing others’ comments, including the response I wrote on behalf of the Central Coast Broadband Consortium, the small LECs asked the CPUC to apply any new criteria to future projects, and not toss out the current batch of proposals, most of which have been languishing for more than a year. They urged a more qualitative approach – not surprising since the quantitative, bang-for-the-buck analysis in the draft largely leaves out their sparsely populated service territories.