Tag Archives: cetf

California’s broadband growth flat for six years


There are two ways to look at the latest Field Poll/California Emerging Technology Fund survey of household Internet penetration: the number of homes with someone online, at one level or another, jumped five points from 79% in 2015 to 84% in 2016, or broadband uptake has stalled in the Golden State for six years.

The case for the former is the topline gloss of the survey which has total broadband penetration at 84%, if you define broadband penetration as at least one person in the house with a smart phone in his or her pocket. That’s the number that went up 5% in one year.

If you look at fixed broadband service, though, it’s a different and depressing picture. In 2010, 70% of homes in California had a broadband subscription – via wireline or fixed wireless service – that was available, in theory, to everyone in the house, all the time. Six years later, in 2016, that number was… wait for it… 70%.

That means that 16% of Californian homes have no Internet access at all, and 14% are second class cyber-citizens, as the Field Poll press release makes clear

The difference between those who have broadband Internet access through a home computing device and those who don’t is fostering what some are calling an “under-connected” class of Internet users. And, these users largely come from the same population subgroups as those with historically lower levels of residential Internet access. For example, not only are low-income Californians less likely than high-income earners to have Internet access at home (68% vs. 97%), the disparities grow wider when comparing how residents with access are connecting to the Internet. Just 43% of Californians with incomes of less than $22,000 can access the Internet at home through a computing device, compared to 94% among those with incomes of $100,000 or more.

Similarly, a smaller proportion of the state’s Spanish-speaking Latinos (69%) than others have access to broadband Internet at home, and just 39% connect to the Internet through a home computing device.

Mobile broadband is as much an essential 21st century service as true home or business Internet access. But it’s not the same thing – people need both, to reap the full benefits of the digital age.

There’s a lot of work yet to do.

Broadband gaps to fill, but willingness to do so in northeastern California


Many homes will still be without broadband service in northeastern California, even after upgrades paid by the federal Connect America Fund (CAF-2) program are complete. That’s mostly because the census blocks deemed eligible for the subsidies by the Federal Communications Commission are limited – many thousands of unserved homes are outside of those areas – but also because the FCC doesn’t necessarily require that all homes in a given census block be served.

I ran an analysis for the California Center for Rural Policy (CCRP), ahead of a meeting with Frontier Communications executives and supervisors from the six counties – Lassen, Modoc, Plumas, Shasta, Siskiyou and Tehama – in the region. It was organised by CCRP and the California Emerging Technology Fund (CETF) and held in Redding on Thursday. It was a follow up to the agreement negotiated between Frontier and CETF, during the regulatory review process that led to approval of Frontier’s purchase of Verizon’s wireline telephone systems in California.

The subsidised census blocks in Frontier’s service territory are concentrated in Modoc, Lassen and Shasta counties. Once the CAF-2 funded census blocks are built out – the deadline is the end of 2020 – there will still be about 1,500 homes without access to wireline broadband service. In those blocks alone. Pulling back and looking at the entire six county region, including AT&T’s territory (but not areas served by small rural phone companies), there will be more than 30,000 homes without access, with about a third of those in Plumas County.

One approach to fixing the problem is to build more middle mile fiber deeper into the region, to make last mile build outs less expensive and boost capacity all around. I ran that analysis too. A Digital 395-scale project – 500 miles, say, of dark fiber through a strategic corridor at a $100 million-plus cost – could, for example, boost wireline broadband availability in Modoc County from the current 36% to 74%, and from 56% to 81% in Lassen County.

There are other ways to approach it, particularly when there’s an incumbent telephone (or cable) company that’s willing to address the problem. As Frontier was in last week’s meeting. The company has a stated policy of working with local communities – doing more than just giving money to a softball team, as one exec put it – and so far, they’re living up to it. The problem of connectivity in northeastern California isn’t solved yet – that’ll take years – but at this point everyone involved is pushing toward a real solution. That alone is a refreshing change.

Tellus Venture Associates presentation, Northeastern Broadband Meeting with Frontier Communications, 23 June 2016

Frontier to offer broadband lifeline service in California, if allowed to buy Verizon systems


Lifeline’s reach, if the deal goes through.

Frontier Communications will implement an interim low income broadband lifeline program in California, if it gets regulatory approval to buy Verizon’s wireline systems. In an agreement reached with the California Emerging Technology Fund (CETF), Frontier is promising to offer a special package to its voice lifeline customers that comprises…

  • 13.99/month for the low-income broadband service (which is a new affordable product for the Verizon service area and an improved product in the Frontier legacy service areas), available only to Lifeline voice customers, existing or new customers.
  • Frontier shall not require any more information from applicant than is required for the California LifeLine program.
  • Up to 7 megabytes per second (Mbps) downstream where 7 Mbps is available and the highest available upstream speed. If less than 7 Mbps service is available, Frontier will provide the highest available downstream and upstream speeds of service.
  • Free Installation.
  • Free Modem with wireless router.

It’s anticipated that the special deal for California would be phased out if and when the Federal Communications Commission establishes a national broadband lifeline program. That’s what makes it an interim program. Frontier and CETF are setting an “aspirational target” of signing up 200,000 low income households.

In the agreement, Frontier also commits to extend 10 Mbps down/1 Mbps up broadband service to 100,000 homes in “selected areas across the Verizon footprint” and 7,000 homes in its “legacy California service areas”, and upgrade service for 250,000 homes in Verizon’s current territory to 25 Mbps down/2 Mbps up. That’s all in addition to upgrading service to 77,000 Verizon homes at the 10/1 level using subsidies from the federal Connect America Fund program (CAF), which it previously said it would do.

The 100,000 homes currently without Verizon DSL service are mostly in rural areas, as are the 77,000 that fall under the federal CAF program. The 250,000 homes that Frontier is pledging to upgrade, though, might be anywhere in Verizon’s current territory, which includes urban and suburban areas, mostly in southern California.

One caveat: the agreement allows it to use Hughesnet satellite service, which Frontier already resells, as a possible way of meeting those goals.

There are other deal points regarding a few dozen public access locations, money for 50,000 tablets for low income areas, and paying non-profit organisations to market broadband service to people that don’t use it yet.

Memorandum of understanding between Frontier and CETF (33 MB)
CETF summary of the deal

Tellus Venture Associates assisted CETF with research, strategy development and policy options. I’m not a disinterested commentator. Take it for what it’s worth.

Home broadband service grows in California but not overall Internet access


High speed home broadband service in California continues to grow, albeit slowly, but Internet use has flatlined among Californian adults. That’s one of the findings of a survey conducted by the Field Poll on behalf of the California Emerging Technology Fund.

According to the report, 87% of Californian homes were connected to the Internet in 2014 and 79% have high speed access – sorta. The survey classified smart phone access as “broadband”. And it is, in comparison to the 6% of homes that still rely on dial-up modem service. The remaining 2% didn’t say how they’re getting their Internet connection – apparently there was no box to check labeled via my neighbor’s WiFi. The split is 71% with computer access (which could be via wireline or a wide variety of wireless technologies) and 8% just relying on smartphones.

Although the take rate for broadband service is climbing – it had been hovering around 75% the past couple of years – total home use has not. That figure has been fluctuating around 86% or 87% for the past four years. Broadband growth, it seems, is coming from converted dial up customers and the I don’t know crowd.

The top line results that were released didn’t drill down on why, but it’s fair guess that the answer is something like last year’s when 36% of those who aren’t connected at home said it’s because they’re not interested in the Internet or they don’t need it, 22% said either access or computers are too expensive and 21% said they don’t know how to use it. Out-of-home broadband access is important – 6% of Californians rely on it completely. The most common source of access for those who don’t have it at home is the public library.

Click to download the 2015 press release
Click to download the 2015 slide presentation
Click to download the 2014 slide presentation

Public sector broadband customers are slow to change, even when it means fast broadband


Schools and other big broadband users have been slow to sign up for service on Digital 395, a 500-plus mile fiber network that reaches from Reno, down the eastern Calfiornia side of the Sierra Nevada, along U.S. Highway 395, to Barstow. The slower than expected take up rate for anchor institutions is causing financial headaches for the system, according to Michael Ort, president of Praxis Associates, the lead company on the Digital 395 project.

“We need to think about the long term sustainability of these systems”, Ort said.

The more than $100 million it took to build it came from federal stimulus program grants and from the California Advanced Services Fund. To get that money, backers had to demonstrate support from government agencies and other major institutions. Organisations up and down the length of the project were quick with letters of support, but enthusiasm for the concept did not automatically become willingness to buy.

Forty percent of those anchor institutions have not signed up for service yet, and those that have tend to buy low speed service that doesn’t take advantage of the gigabit-class bandwidth an open access fiber network like Digital 395 makes possible, Ort told attendees at a broadband conference in Riverside earlier this month, organised by the California Emerging Technology Fund. Hospitals are signing up for high speed connections, he said, but that aside the average institutional customer is buying 36 Mbps service, with many opting for 10 or 15 Mbps.

Meanwhile, one third of Digital 395’s annual operating budget – $1.5 million – is going to pay property taxes. That’s good for local governments and schools, but it makes for a rough financial ride.

A skeptical eye finds more broadband opportunities


The California Public Utilities Commission collects a mountain of data from Internet service providers, and does a good job of sorting it out and publishing it in a very accessible way. But as a state regulatory agency, the CPUC can’t arbitrarily decide which claims it’ll believe and which it’ll discount. So it runs tests.

Ryan Dulin, the head of the CPUC division that regulates telecoms companies and manages broadband infrastructure subsidies through the California Advanced Services Fund (CASF), demonstrated how that works for mobile broadband, running a speed test on his Verizon service during his presentation at a broadband conference for local government officials. The result was 4 Mbps download and 1.5 Mbps upload speeds. Which is just a teeny bit different from the service report Verizon submitted to the commission, claiming it delivers somewhere between 10 Mbps and 25 Mbps download speeds in Riverside, where the event – organised by the California Emerging Technology Fund – was held this week.

It highlighted the need to drill further down into the data and do on-site verification, if local agencies and independent Internet service providers want to pursue CASF-subsidised broadband projects. When my turn to speak came, I showed how a couple of analytical techniques that I’ve helped develop – along with colleagues from several regional broadband consortia – that highlights where local broadband gaps and opportunities can be found.

One was the broadband report card analysis I initially ran for the East Bay Broadband Consortium, which grades the broadband infrastructure in neighborhoods, cities and counties on an A-B-C-D-F scale. The other was a broadband opportunity heat map, which highlights areas that are eligible for CASF funding according to population density – from red, which means lots of potential customers, down to green which means not so much. The Central Coast Broadband Consortium was the first to use that technique to identify broadband development priority areas.

The key is to focus on primary wireline network operators – incumbent cable and telephone companies, mostly – and ignore, at least initially, what wireless companies and resellers claim to deliver. That helps policy makers and entrepreneurs figure out what’s actually on the poles and in the ground, and set priorities for broadband investment.

Subsidising second class broadband is a bad deal for all Californians


Hotel WiFi service is usually good enough to deal with email, Facebook and airline check-ins. It’ll do the work you have to get done before morning – maybe even a Skype call. But it’s rarely robust enough to reliably watch videos or jam a deadline on virtualised enterprise services or relax with an online game. It’s not a workhorse you can depend on. It’s an amenity, no more able to support day to day business than the tiny pool and token workout room can handle Ironman base training – I know, I tried.

So why is that level of service good enough for people who live in publicly subsidised housing, when it isn’t acceptable for the taxpayers who are footing the bill? The California Emerging Technology Fund (CETF) didn’t think so, in its response to a proposed broadband facilities grant program under consideration at the California Public Utilities Commission. The CPUC’s office of ratepayer advocates (ORA) doesn’t think so either, in comments filed earlier this week.

It’s not.

The performance fixes proposed by CETF and ORA are half measures at best. Raising the required upload speed (albeit with slower and cheaper options) to the same 1.5 Mbps standard the CPUC sets as a minimum for everyone else in California is a fine idea. But 6 Mbps – the CPUC’s download minimum – is barely table stakes for people trying to make a living or navigate government bureaucracy or for kids doing doing home work.

The proposal in front of the CPUC now sets 1.5 Mbps down as the minimum subsidised service level (although network capacity minimums are higher), and CETF isn’t contesting it. ORA is pushing for 3 Mbps. Better, but still less than the minimum that’s considered good enough for the rest of us. It’s a dumbed-down standard that’ll allow publicly subsidised, hotel-grade WiFi systems to be installed instead of hard wired facilities.

Californians are paying for it. Californians deserve better.

Public housing broadband should be cheaper and faster, CETF says


How much should Internet access in public housing projects cost, and how fast should it be? Those are the central two questions that the California Emerging Technology Fund is raising in regards to a proposed public housing broadband subsidy program, currently under consideration at the California Public Utilities Commission.

In comments filed on Tuesday, CETF is taking the position that public housing residents should be able to buy a minimum level of service for $10 per month, rather than the $20 as currently proposed, and that the minimum service speed residents can get during peak hours – 7 to 11 p.m. – should be 1.5 Mbps for both download and upload…

CETF agrees with the majority of the housing agencies that participated in the CPUC Housing Workshops earlier this year and suggests that service fees of up to $10 a month is more in line with the economic realities and affordability limits of the residents…When participants were asked for a reasonable affordable rate for residents of publicly-subsidized housing, there was general agreement that low-income residents would be able to afford a high-speed Internet service at home of up to $10 a month. That is also the current monthly cost of Comcast Essentials…

The plan now in front of the CPUC sets 1.5 Mbps as the minimum for peak period downloads, but sets no service minimum for upload speed, although subsidised systems must be capable of delivering the CPUC’s minimum of 6 Mbps down/1.5 Mbps up.

The Comcast Internet Essentials program – in theory – offers 5 Mbps down/1 Mbps up for $10 per month to households that have at least one child eligible for a subsidised lunch program at school. The program has rightly been slammed for being a sham. Comcast makes it difficult for people to sign up, and then does what it can to move them to higher priced service. But the service itself has never been particularly criticised – 5 Mbps is easily within the capabilities of Comcast’s network.

If public housing projects actually get wire then capacity isn’t a problem and minimum service levels are largely a function of how much backhaul bandwidth is purchased. Service minimums should be set using wired cost and performance standards, not dumbed down to accommodate quick and dirty WiFi installations.

Fast track broadband projects proposed in northern California


Almost 120,000 people – 50,000 households – in 14 California counties would be reached by broadband projects reviewed by the California Emerging Technology Fund (CETF) at its rural forum in Redding last week.

The list of “projects with some current momentum” was developed with the cooperation, and in many cases active participation, of the regional broadband consortia that represent those areas. The plan going forward is to work with project backers, state and federal agencies and CETF to bundle financing together that will cover the typical 30% to 40% investment match requirements of the California Advanced Services Fund.

All the areas involved have been at least provisionally identified as qualifying for CASF grants, which cover 60% to 70% of project construction costs. Loans are also available to cover up to another 20%, to a maximum of $500,000 per project. Projects can be submitted to the California Public Utilities Commission beginning in a little over a week, on 1 December 2014.

One of the projects – dubbed Digital 299 after the state highway it would follow – is aimed at bringing inexpensive middle mile connectivity to Trinity County. The project particularly includes Weaverville, which was pinpointed as a potential hot spot for data center development due to the low cost of electricity there. It also ranked high on measures of social impact and business potential in an analysis I presented at the conference. It’s similar in concept to the Digital 395 fiber network that is now up and running from Reno, down the eastern side of the Sierra Nevada to Barstow.

Heat maps point the way to California broadband gold


Maps and raw data showing broadband availability correlated to demographic and economic statistics are now available for 36 northern California counties, thanks to the California Emerging Technology Fund. It was developed for CETF by the City of Watsonville and Tellus Venture Associates, for a two day meeting in Redding that’s aimed at identifying a short list of feasible broadband infrastructure projects that can be paid for, in part, by the California Advanced Services Fund.

The center piece of the analysis is a heat map that shows areas that are eligible for CASF subsidies, color coded by housing density. It’s a money map: the hot zones are where grants paying for 60% to 70% of construction costs are available and there are enough customers in a small enough area to make the ongoing business case possible. (Click here for the 12 MB version of the map).

Along with the maps – which are available for each county – is spreadsheet data for each census block and every primary wireline service provider, tied to population, housing, household income and other key business data. The GIS source files were posted as well.

We went over the information yesterday – I gave a presentation that stepped through the analytical process – and used it to develop rough-cut ranking lists, that scored infrastructure project areas by both the potential social impact and business feasibility.

The conference is continuing today. We heard from state and federal agency representatives yesterday, including overviews of the CASF application and evaluation process from California Public Utilities Commission staff. Today the talk is about broadband projects.

Click to browse and download the CETF broadband opportunity maps and data (FTP site).