FCC’s broadband victory proclamation looks like regurgitated spam

by Steve Blum • , , , ,

Spam

A wireless Internet service provider dumped a big load of map spam on the Federal Communications Commission last year, which appears to have fooled it into thinking that its “reforms” have brilliantly resulted in broadband “being deployed on a reasonable and timely basis” in the U.S. It’s a problem we have in California, as well.

In a letter to the FCC, the broadband advocacy group Free Press pointed to widely unbelievable – impossible – coverage claims made by BarrierFree, an east coat wireless Internet service provider…

BarrierFree claimed to offer FTTH service with downstream speeds of 940 Mbps to 100 percent of the geographic area and 100 percent of the population of New York State, and also to 100 percent of those seven other states. BarrierFree’s over-reporting in this manner not only produces wildly overinflated deployment claims for itself and these eight states: it also has a substantial impact on the putative change in deployment at the national level. Indeed, BarrierFree is claiming to be the only ISP offering service in 15 percent of all Census blocks that were listed as unserved in the June 2017 Form 477 data.

The coverage and service data submitted by BarrierFree go beyond the inflated claims routinely made by WISPs. It said it offered near-gigabit fiber to the home service to everyone in those eight states, along with its implausible wireless product.

Although BarrierFree’s false reporting is unusual in its scope, it’s a common and chronic problem with the FCC’s broadband data collection system. And it’s not limited to WISPs. In California, companies that resell capacity on other companies’ lines say they’re providing service in tens of thousands of census blocks, when in reality they, at best, have agreements that might let them offer service if anyone asks for it and the underlying carriers have lines of sufficient quality available – not a sure bet by a long shot.

The FCC should have reviewed BarrierFree’s data before accepting it, let alone doing a victory dance based on it. It’s gullability such as this that’s led to bipartisan calls for better broadband data collection and mapping, even to the extent of getting a call out in the Trump administration’s latest budget proposal.

Tacoma weighs risk and reward with list of muni broadband suitors down to two

by Steve Blum • , , ,

The City of Tacoma has narrowed the list of possible buyers of its municipal cable system – aka Click – down to two local companies, Wave Broadband and Rainier Connect. A year ago, the city issued a request for information and qualifications and received responses from five companies. Only two initially met the city’s specifications – Wave and Yomura Fiber – but subsequent talks convinced Rainier to take on more risk, and led to Yomura’s exit, due to ownership concerns. Click is operated by, and operationally integrated with, the city’s municipal electric utility, which has a different set of federal rules to follow.

CTC Technology and Energy, an east coast consulting firm, helped evaluate the proposals and is recommending that the city go with Rainier, largely because it’s offering to lease the system for $2.5 million to $3 million per year, while Wave is only offering $1 million a year. But, CTC’s report acknowledges, Rainier is a riskier partner…

Wave is a large, private equity-backed, enterprise that is part of the sixth-largest broadband company in the United States. As such, it should easily be able to scale to meet the obligations contemplated in the term sheet and thus represents a very low risk proposition for the partnership.

Rainier Connect is a smaller, family-owned enterprise with far less scale and resources, and thus entails some more risk for TPU and the City than would a partnership with Wave. Rainier Connect does appear to have the capability to scale up operations to meet its proposed obligations.

Wave also has considerable experience building and operating broadband systems as the third player in markets with incumbent telephone and cable companies. Rainier doesn’t appear to have much, if any, experience as a facilities-based wireline cable company or Internet service provider.

Both companies promised to abide by network neutrality principles, and to offer discounted service to low income households, as required by the city. But they fudged on open access commitments.

As CTC’s analysis put it, both companies “will provide wholesale services consistent with its practices and policies in other markets”. Which really means that the access available to third party Internet service providers won’t be so open – in this case, probably a good thing because Click already competes with Comcast and CenturyLink in Tacoma. Forcing a private operator to cede space to other competitors on an unrestricted basis could very well lead to the kind of business case death spiral the Utopia project in Utah found itself in.

For now, the city is taking public comment before making a final choice.

City of Tacoma fact sheet, Click private/public partnership, 5 March 2019
CTC presentation, Click private/public partnership, 5 March 2019
CTC report, Rainier and Wave term sheets, 5 March 2019
CTC summary, Rainier and Wave term sheets, 5 March 2019
Rainier Connect, Click term sheet, 5 March 2019
Wave Broadband, Click term sheet, 5 March 2019

More documents regarding the City of Tacoma and Click are here, and more blog posts are here.

Four California counties say “no criminal charges” for PG&E

by Steve Blum • , , , ,

Pacific Gas and Electric won’t face criminal charges for its role in starting several northern California fires in 2018. District attorneys in Sonoma, Napa, Humboldt and Lake counties announced that they can’t prove a case. According to a press release from Sonoma County district attorney Jill Ravitch, the necessary evidence burned up along with everything else…

The cases that were referred for prosecution all required proof that PG&E acted with criminal negligence in failing to remove dead and dying trees. Under California law, criminal negligence requires proof of actions that are reckless and incompatible with a proper regard for human life, and any charges must be proven unanimously to a jury beyond a reasonable doubt. Proving PG&E failed in their duty to remove trees was made particularly difficult in this context as the locations where the fires occurred, and where physical evidence could have been located, were decimated by the fires.

Last year, Cal Fire determined that some of the many fires that roared through California’s wine country began when trees or other vegetation came into contact with PG&E electric lines. The deadliest fire – the Tubbs fire – which killed 22 people and spread as far as city neighborhoods in Santa Rosa, was not linked to PG&E’s equipment according to Cal Fire. That one was apparently started by electric lines strung across private property by the landowners.

So far, prosecutors in other counties affected by fires linked to PG&E infrastructure have declined to charge PG&E with crimes. But that’s cold comfort. Ravitch was careful to point out that “PG&E remains on federal criminal probation and is a defendant in many private civil cases arising out of the wildfires”, including one that the County of Sonoma is pursuing. The combined liability PG&E faces from those fires as well as last year’s even deadlier Camp Fire is expected to top $30 billion. Who gets paid and how much is now in the hands of a federal bankruptcy court.

T-Mobile plays daddy says no, go ask mommy game at CPUC

by Steve Blum • , , , ,

Brady bunch

Instead of playing nice with the other kids, T-Mobile is asking for parental intervention as the California Public Utilities Commission reviews its proposed deal to takeover Sprint. Possibly afraid its document dumping and foot dragging tactics are going to backfire and cause even more delays at the CPUC, T-Mobile sent a joint letter to commissioner Clifford Rechtschaffen yesterday, telling him don’t tap the brakes, you need to step on the gas dude

The Commission’s timely review will help ensure that Californians benefit from the broad range of benefits documented in the extensive evidence we have submitted to the Commission. Conversely, any action that could delay consummation of the merger would slow the build-out of New T-Mobile’s robust, 5G network in California, thereby delaying New T- Mobile’s ability to provide all consumers in California the benefits of that network—such as increased speeds and expanded coverage, lower prices, and a bona fide wireless alternative to traditional in-home broadband service.

The problem is that T-Mobile, which is walking point at the CPUC for both companies, keeps turning up the volume on both its claims of wonderfulness and the amount of paperwork its shovelling as it attempts to convince regulators that the deal won’t do more harm to consumers than good.

The FCC paused its review of the deal for at least three weeks, because T-Mobile’s latest filings “contain substantial new material and reach conclusions about the effects of the transaction that were not previously in the record”. The CPUC administrative law judge (ALJ) managing the case, Karl Bemesderfer, added four weeks to his review because T-Mobile similarly introduced thousands of pages of new evidence to shore up its arguments that its takeover of Sprint would benefit Californians, rather than killing a competitive market for mobile broadband services.

Rechtschaffen is the commissioner assigned to oversee the T-Mobile/Sprint review. It would be procedurally and politically dicey, to say the least, if he intervened. Similar pleas have been made in high profile telecoms mergers in the past to no apparent effect, particularly on Bemesderfer who rates as one of the keenest and most telecoms savvy ALJs at the commission.

Right now, he’s considering a request from the CPUC’s public advocates office to force T-Mobile to handover supporting documents that were requested weeks ago. T-Mobile’s response is expected tomorrow. We’ll find out whether they think a cooperative attitude will help speed up the process.

Trump’s budget plan puts broadband funding, mapping on table

by Steve Blum • , , , ,

Broadband gets several call outs in the proposed budget released yesterday by the Trump administration. One initiative is endorsed for another year, two are re-promised and one appears to be a response to widespread criticism. Line item figures haven’t been published yet, but even just the overview runs to 150 pages. Details on plans are scarce, but the broadband snippets that were included tell an encouraging tale.

Agriculture secretary Sonny Perdue has bucked the administration’s love fest with big, incumbent cable and telephone companies and pushed for community-based broadband service, particularly via rural electric coops. His department has also adopted a much friendlier attitude toward independent broadband providers in its ReConnect infrastructure grant program. The administration’s budget summary gives him props for that…

The Budget focuses on core Departmental activities such as agricultural research, rural lending, and protecting the Nation’s forested lands and private agricultural lands, while also supporting the Secretary’s efforts to improve services and expand broadband.

The so-called trillion dollar infrastructure program sets aside $200 billion “for other infrastructure priorities”, with “a portion” of it earmarked to…

Promote visionary projects and technologies that can strengthen our economic competitiveness, including 5G wireless communications, rural broadband, advanced manufacturing, and artificial intelligence.

The plan also promises continued efforts to make better use of wireless spectrum and a fresh look at the much criticised broadband data collection and mapping work carried out by the Federal Communications Commission and the National Telecommunications and Information Administration…

The Budget supports the application of innovative spectrum access techniques, spectrum sharing technologies, and spectrum leasing options to enable smarter and more efficient ways to leverage the Nation’s valuable and finite spectrum resources. As part of the Administration’s commitment to the Heartland, the Budget funds broadband mapping work to support ongoing efforts to increase the availability of affordable, reliable, and modern high-speed internet access in rural and underserved communities.

On the other hand, nothing is said about the federal government’s primary broadband subsidy program, the Connect America Fund. It’s run by the FCC and is directing billions of dollars to incumbents, much of which will be wasted on replacing rural copper networks with low capacity wireless service.

Presidential proposals are little more than openers in congress’ annual budget game. With spending bills constitutionally required to begin in the democrat-controlled house of representatives, it’s a safe assumption that lots of changes will be made as the process proceeds through the summer.

T-Mobile stalls CPUC, FCC reviews of Sprint merger with cheap lawyer tricks

by Steve Blum • , , , ,

Getting a fast approval of its proposed takeover of Sprint from federal and state regulators is supposedly T-Mobile’s goal, but it’s not helping itself. Last week, its habit of stonewalling and waiting until the last minute to provide information to regulators reviewing the merger resulted in a three week (minimum) hold at the Federal Communications Commission and a demand from California Public Utilities Commission staff to turn over stacks of documents previously requested. That demand could also lead to a further delay in getting California’s blessing for the deal.

According to an FCC notice, the agency needs time to review new claims about the wonderfulness of the merger made by T-Mobile and get public feedback…

On February 21, 2019, and March 6, 2019, the Applicants filed significant additional information regarding their network integration plans for 2019–2021, an extension of their previously filed merger simulation analysis to cover the years 2019–2021, and additional information regarding their claims related to fixed wireless broadband services. These filings contain substantial new material and reach conclusions about the effects of the transaction that were not previously in the record.

As a result, the FCC added at least three weeks to its review, pausing its informal 180-day shot clock at 121 days, with a restart not scheduled until 4 April 2019 at the earliest.

One problem is that a key filing describing T-Mobile’s plans to offer in-home service is marked confidential, so the FCC won’t be getting much public comment on it.

The CPUC’s public advocates office (PAO) asked the administrative law judge (ALJ) managing the case to force T-Mobile to produce more data, to back up the claims made in a similar avalanche of data ahead of hearings last month. That dump and T-Mobile’s introduction of new claims, resulted in a four week delay. The PAO says that “in response to the Public Advocates Office’s Data Requests to T-Mobile…T-Mobile provided only objections and no substantively responsive answers. T-Mobile’s objections are unfounded and inappropriate”.

The back and forth argument over evidence is eating up the extra time added to the schedule by the ALJ. If that causes the problem, the obvious solution is to add even more time, something T-Mobile claims it doesn’t want to happen.

Alternating last minute data dumps with lawyerly foot dragging seems like a bad way of getting a quick decision from the CPUC and the FCC. If T-Mobile is really in the hurry it claims to be to get the Sprint deal approved, it needs to start playing nice with the other kids.

Collected documents, dumped and otherwise, from the CPUC’s review of the proposed merger of Sprint and T-Mobile are here.

“Significant hardships” will fall on cities if appeals of FCC pole ownership preemption stall, court told

by Steve Blum • , , , ,

The cities and counties that are challenging the Federal Communication Commission’s preemption of local ownership of streetlight poles and other assets located in the public right of way don’t want any delays in their cases. In filings yesterday with the ninth circuit federal appeals court in San Francisco, local agencies objected to the FCC’s request to put everything on hold while it thinks about whether it’s going to reconsider its decision. Which could take months, or longer.

The primary objections came from a large group of agencies led by the City of San Jose. Pointing out that the FCC’s “September order” is already in effect and commissioners are bragging about, the group said it’s now in the court’s hands

There is no evidence suggesting the September Order is anything other than the final result of its decision-making process. The FCC continues to publicly stand by the September Order as adopted. Commissioner Brendan Carr, who has been leading the FCC’s infrastructure efforts, recently highlighted the September Order in a February 5, 2019 speech, asserting that the agency was “not going to slow down” in its infrastructure efforts, and that the September Order (which had at the time been effective for only 22 days, and then only in part) was already impacting local government practices and wireless deployment. There is no reason, therefore, to suppose that further delay will somehow actually resolve the issues raised in these appeals, or that the September Order on appeal here is anything other than the “final administrative work.”

Flanking objections were entered by the City of Huntington Beach and a smaller group led by the City and County of San Francisco. Accusing the FCC of being “at worst disingenuous”, San Francisco said that the September order imposes “real, concrete hardships” on local governments…

Some Municipal Parties, consistent with state law and with prior court precedent, charge rent-based fees for commercial use of municipal property. San Francisco, for example, has licensed access to hundreds of its streetlight poles and transit poles for small cell facilities at an agreed-upon rate in excess of $4,000 per year. Demand for access to those poles has continued unabated since the FCC issued the Order. Further, many of those licenses have reached the end of their first year and must be renewed for the agreed-upon license fee. Again, while the Order is in effect, a local government must either comply (e.g., charge only cost-based fees at or below the Order’s presumptive thresholds) or risk litigation over its actions on every wireless siting application it receives, or at renewal of any existing license agreement.

The FCC order took direct aim at agencies like San Francisco that charge what it, and its mobile carrier friends, consider to be exorbitant. As far as the FCC is concerned, $270 per year is sufficient.

For now, the ninth circuit hasn’t ruled on the FCC’s request and the cases are still moving forward.

Links to motions, petitions, court documents and background material, Californian and federal, are here.

My clients are mostly California cities, including some that are directly involved in this case. I’m not a disinterested commentator. Take it for what it’s worth.

Net neutrality back in play in U.S. congress as democrats offer new bill

by Steve Blum • , , ,

Congressional democrats are taking another run at overturning the Federal Communication Commission’s 2017 decision to scrap network neutrality rules. Yesterday, amid much fanfare, a draft of a bill was released that would nullify the 2017 decision by the FCC’s republican majority and reinstate the 2015 decision by the then democratic majority to regulate broadband as a common carrier service. Along with that decision came bright line rules: no blocking, throttling or paid prioritisation of subscriber traffic by Internet service providers.

Technically it’s two identical bills, one each for the senate and the house of representatives. But as a practical matter it’s one piece of legislation.

Although the language is necessarily different, the bill would do pretty much the same thing as last year’s attempt to block the FCC’s net neutrality repeal via the Congressional Review Act. Enough republican senators jumped ship to approve the measure, but house republicans did not follow suit and it died.

This latest bill goes one step further. It forbids the FCC from trying again, saying the 2017 repeal “may not be reissued in substantially the same form”.

Reaction was predictably split on partisan lines. For example, republican FCC chair Ajit Pai’s office released a statement condemning the new bill, while democratic commissioner Jessica Rosenworcel praised it.

There seems to be no rush to get the bill in motion, though. House speaker Nancy Pelosi said it would be “a matter of weeks” before any action is taken. Since democrats control the house of representatives, the bill is likely to pass there first, assuming telecoms lobbyists don’t succeed in buying off federal lawmakers, as they were nearly able to do last year in California.

Republicans control the senate, by a bigger margin than they did last year, so there’s no guarantee that a 51 vote majority can be found there, let alone the 60 votes needed to stop the inevitable filibuster.

PG&E faces pole attachment shot clock, as CPUC arbitrator hands Crown Castle a win

by Steve Blum • , , ,

White road attachment

An administrative law judge gave Crown Castle a victory of sorts in a dispute over terms for attaching fiber optic cable to utility poles that Pacific Gas and Electric owns. Assuming the California Public Utilities Commission signs off on the finding, the arbitrated decision by ALJ Patricia Miles leaves PG&E’s leasing model and most of its standard terms in place. But, in effect, it also establishes a 45 day shot clock for responding to attachment requests and allows Crown Castle to do some work on poles without notifying PG&E and to be notified, in some circumstances, if work affecting its cables is planned.

Originally, Crown Castle wanted the CPUC to force PG&E to sell space on utility poles by the foot. Typically, PG&E either sells all the space available for telecoms cable attachments – the communications zone – to one company, such as AT&T, and then relies on that company to manage attachment requests by other carriers. Or it will lease out space by the foot to telecoms attachers, such as Crown Castle, and manage the communications zone itself.

The rent versus buy financial analysis aside, the main operational difference between owning and leasing space is that pole space owners can add cables and maintain them with less administrative overhead, and can expect a greater degree of coordination from PG&E. Crown Castle wanted those privileges, but didn’t want to – perhaps legally couldn’t – take on the responsibility of owning and managing the entire communications zone.

Using an expedited arbitration process established by the CPUC, Crown Castle challenged PG&E’s standard procedure, but Miles rejected its argument that state law and CPUC rules require by-the-foot sales of attachment space. She then told the two companies to negotiate an agreement on that basis.

That didn’t happen. In her draft decision, Miles said “the parties inexplicably failed to submit such an agreement”. Instead of coming back to her with a settlement, the companies each offered their preferred contract language: PG&E filed its standard contract; Crown Castle proposed changes to that contract giving it many of the privileges of ownership.

In a baseball-style arbitration decision, Miles chose Crown Castle’s version, saying “PG&E has not objected to Crown Castle’s revisions to its license agreement”.

Key elements of the changes to PG&E’s standard attachment contract include:

  • Crown Castle needs written permission to attach cables to PG&E owned pole space, “unless 45 days have run from the time of request of access and Company has provided no response”. Neither the ruling or the contract define what, exactly, constitutes a response, but silence certainly doesn’t qualify.
  • Crown Castle does not have to give PG&E 48 hour notice if it’s doing routine repair or maintenance that doesn’t require electricity to be shut off.
  • PG&E has to notify Crown Castle when another telecoms company wants to attach to a pole that Crown Castle is already occupying.
  • When that happens, PG&E needs Crown Castle’s permission to rearrange cable attachments or replace poles if needed.

Since this was a one-off arbitration of a particular dispute between two companies, the decision won’t affect any existing pole attachment contracts or necessarily serve as a template for future ones. But it might.

The CPUC is scheduled to vote on the draft decision at its 14 March 2019 meeting.

Collected documents from the Crown Castle/PG&E pole attachment arbitration at the CPUC are here.

AT&T has an odd way of turning anti-trust victory into market domination

by Steve Blum • , , , ,

In the wake of a federal appeals court victory, AT&T moved quickly to consolidate control over the Time-Warner media companies it now owns. The apparent strategy is to meet Netflix head on as a content competitor. The initial signs are not encouraging.

As well reported by Jessica Toonkel in The Information, the top executives of HBO and Turner, two of the three Time Warner divisions acquired by AT&T (the third is the Warner Bros. studio), are gone. According to Toonkel’s article, AT&T wants to crank up the content production pace…

HBO is one of Time Warner’s crown jewels, the top ranked premium cable channel long known for hit shows ranging from “The Sopranos” to “Game of Thrones.” But the growth of Netflix has spotlight how little HBO has evolved in recent years. The company makes a handful of shows, compared to the hundreds made by Netflix. It resisted small changes, such as putting all episodes of its shows on the air at once, unlike Netflix. Shortly after the AT&T takeover, AT&T executives began signalling they wanted HBO to make more shows.

I worked with HBO in the mid-nineties, as the company I was working for – U.S. Satellite Broadcasting – was launching what eventually became DirecTv, another AT&T acquisition.

HBO has evolved over the past 25 years, but its core remains unchanged: it’s a video packaging and distribution company that produces a relative handful of marquee jewels, but relies on the broader industry for most of its content. The same might be said of Netflix, except that its hand is a lot bigger and its tolerance for imperfect gems is a lot higher.

Netflix produces excellent films and series, but that’s fuelled by a blockbuster budget – $13 billion in 2018 by one estimate – that’s higher than any mainstream studio. It also has a reputation for giving producers and directors a free hand, with little interference from the suits.

Money and creative freedom are two of three essential ingredients to success in Hollywood. The third is personal relationships, something the old HBO excelled at building and maintaining. The business doesn’t work like a car factory. You can’t just add a second shift and send in the bean counters. With neither the budget or the corporate culture to match Netflix, AT&T is taking a huge risk by disrupting those relationships.