Time running out for CPUC to maximise federal bang for California broadband bucks

by Steve Blum • , , , ,


So far, the California Public Utilities Commission isn’t budging on its nonsensical plan to decide after the upcoming federal Rural Digital Opportunity Fund reverse auction whether it will offer cash incentives to Internet service providers that might be bidding for broadband service and infrastructure subsidies for Californian communities.

Instead, it’s taking comments on a plan drafted by staff. Not comments from the general public though. Only those who file the necessary paperwork to become a “party” to the “proceeding” have a say. I did that on behalf of the Central Coast Broadband Consortium, and observed that offering ISPs money before they bid creates an incentive to do so more aggressively, but giving them money after they bid is just, well, giving them money…

The incentive value of the proposed [cash supplement] will be greatly diminished, and the objective of motivating organizations to submit bids that are lower – i.e. more competitive vis a vis other States – will not be achieved. Instead, any [California Advanced Services Fund] subsidy that is ultimately awarded to successful bidders will merely reimburse them for costs they would have otherwise paid out of their own funds. It will be a gift of public money without the compensatory benefit of more broadband infrastructure and service upgrades for more Californians than would have otherwise occurred…

No additional authority or direction is required to implement the Staff Proposal. Indeed, to engage in a lengthy and litigious deliberative process is to defy explicit directives to immediately implement an RDOF incentive program from both the California Legislature and the [CPUC].

Comments on the staff’s proposal filed by other organisations, whether or not accepted into the official record, are below. Replies and rebuttals are due Thursday. A decision on whether to approve the plan as is, modify it or scrap it entirely will likely come in December. The Federal Communication Commission’s RDOF auction takes place on 29 October 2020.

Correction: replies are due on Thursday, 22 October 2020, not 20 October 2020. The change has been made above.

Comments on CPUC Staff Proposal on State-Federal Broadband Infrastructure Funds Leveraging, Rulemaking 20-08-021, published 1 October 2020

California Emerging Technology Fund
Central Coast Broadband Consortium
CPUC public advocates office
Electronic Frontier Foundation
Greenlining Institute and TURN
National Diversity Coalition
North Bay North Coast Broadband Consortium
Rural County Representatives of California
Small LECs, aka independent rural telephone companies

T-Mobile might get extra time to deploy in California, but must add extra jobs and meet California test standards

by Steve Blum • , , , ,

Tmobile billboard las vegas 6jan2020

T-Mobile will get another two years – until 2026 – to deploy 300 Mbps 5G service to 93% of Californians, if a draft decision published on Friday is approved by the California Public Utilities Commission. But two other requested “modifications” to the CPUC’s conditions for approving T-Mobile’s merger with Sprint were rejected in the decision proposed by administrative law judge Karl Bemesderfer.

Assuming that CPUC commissioners vote in favor of it – a pretty good bet – it means that T-Mobile will have to add 1,000 net new jobs in California, instead of firing 1,000 higher paid employees and hiring 1,000 lower wage workers at a call center in Fresno County, as it appears to be doing. Bemesderfer’s draft rejects the claim that the CPUC doesn’t have legal authority over its labor practices on a legal technicality. T-Mobile’s ace lawyers bundled it into a “petition for modification”, instead of the “request for rehearing” that Bemesderfer says is the proper way to do it.

He also said that there’s nothing wrong with using California’s own mobile broadband testing program to track T-Mobile’s compliance with California’s own conditions…

On balance, while we recognize that there is a possibility of conflict between state and federal performance standards, we find that the benefits of measuring T-Mobile’s compliance with California-specific conditions with the CalSPEED test outweigh the possible inconvenience of having the same activity measured two different ways. While Joint Applicants raise the possibility of federal pre-emption, we see no indication in the federal proceedings of an intention on the part of federal regulators to pre-empt state action in this area.

T-Mobile had argued that the Federal Communications Commission’s mobile testing program is sufficient, which Bemesderfer didn’t buy. He did, however, accept T-Mobile’s argument that the deployment timeline they promised – and that he wrote into the original decision – was 2026, six years from when the merger closed, instead of 2024, which would have been six years from when the CPUC began reviewing the deal.

Links to arguments, exhibits and other paperwork regarding the T-Mobile/Sprint merger filed at the CPUC and elsewhere are here.

My clients include California cities who do business with T-Mobile. I like to think that has no bearing on my commentary. Take it for what it’s worth.

California’s two biggest broadband companies may pass up federal RDOF subsidy auction, but others are in the hunt

by Steve Blum • , , , ,

Money case 625

The Federal Communications Commission included 24 obviously Californian contenders in its final list of 386 qualified bidders for Rural Digital Opportunity Fund (RDOF) money (list is below). The announcement didn’t say which service tiers they’re eligible to bid in. There are four tiers, with higher service levels getting preference in the auction: 25 Mbps download/3 Mbps upload, 50 Mbps down/5 Mbps up, 100 Mbps down/20 Mbps up, 1 Gbps down/500 Mbps up (what the FCC considers to be gigabit service).

There will almost certainly be more than a couple dozen Internet service providers going after RDOF subsidies to upgrade broadband service in California. There are probably companies on the eligible list without a prominent presence here who will bid in the reverse auction on 29 October 2020. And others could be hiding behind camouflaged corporate identities are buried within groups of bidders – “consortia”, as the FCC refers to them.

The most significant names on the eligible list are bankrupt Frontier Communications and a subsidiary of Charter Communications, CCO Holdings, LLC. Both are also going after California Advanced Services Fund (CASF) grants for broadband upgrade projects in areas eligible for RDOF money.

The missing names are even more significant: AT&T and the two major cable companies in California, Comcast and Charter Communications. Comcast almost certainly isn’t interested in RDOF money – it avoids the strings attached to public subsidies like the plague – but AT&T might have filed under an alias, as Charter did, and could yet pop up out of hiding.

Smaller cable companies – Cox Communications, Suddenlink (via corporate parent Altice), Mediacom, Horizon and San Bruno – made the cut, as did telcos like CenturyLink, Verizon and Ponderosa. Not all of them may be bidding in California – the FCC didn’t say which states the lucky 386 are interested in.

Several wireless ISPs with California systems are on the list, but they might struggle to win bids here. Bidders who convinced the FCC they have the capability of delivering gigabit service have a significant advantage in the complicated RDOF reverse auction process. A WISP which only qualifies for, say, the 25/3 tier will have a difficult, if not impossible, time competing against a fiber to the premise company that offers a legitimate gigabit. Since the competition is nationwide, Californian ISPs restricted to lower tiers will be at a distinct disadvantage to wireline companies bidding for subsidies in other states.

Eligible RDOF bidders with California ties

  • Altice USA, Inc.
  • Cal.net, Inc.
  • California Internet, L.P. dba GeoLinks
  • Charter Communications/CCO Holdings, LLC
  • CenturyLink, Inc.
  • Conifer Communications
  • Consolidated Communications, Inc.
  • Cox Communications, Inc.
  • Digital Path, Inc.
  • Digital West Networks, Inc.
  • Etheric Communications LLC
  • Frontier Communications Corporation, Debtor in Possession
  • Hankins Information Technology
  • Horizon Cable TV, Inc.
  • Mediacom Communications Corporation
  • NRTC Phase I RDOF Consortium (includes Plumas Sierra cooperative)
  • Ponderosa Communications, Inc.
  • RDOF USA Consortium (includes Anza cooperative)
  • San Bruno CityNet Services
  • Sierra Nevada Communications
  • South Valley Internet Inc.
  • Surfnet Communications
  • Ultimate Internet Access, Inc.
  • Verizon Communications Inc.

CPUC judge tells Frontier, consumer groups to stop squabbling and deal with the issues

by Steve Blum • , , , ,

Both Frontier Communications and the “intervenors” who want a say in how its bankruptcy reorganisation plays out in California were scolded yesterday by a California Public Utilities Commission administrative law judge (ALJ). The result might be a delay – maybe a week, maybe something else – in concluding the CPUC’s review of the reorganisation plan and the bankruptcy settlement.

In an emailed ruling, ALJ Peter Wercinski cancelled three days of hearings scheduled for the end of the month, saying that none of the parties involved have yet addressed the issues surrounding the bankruptcy that were identified by the commission

The Public Advocates Office stated in its October 12, 2020 response that “all material issues in the Scoping Memo remain at issue.” When asked at the October 13, 2020 status conference whether all [identified] issues would need to be addressed at evidentiary hearings, counsel said no but failed to identify which issues would need to be addressed at the hearings….The Utility Reform Network (TURN) stated that it was still reviewing testimony regarding a plan for cross-examination and identification of disputed issues of fact. Although TURN’s response did reference several issues it identified as disputed facts, TURN failed to state that those references were all of the material issues of disputed fact to be addressed at the hearings. In its response, [Frontier] failed to identify any [identified] issues but rather argued that the hearings should focus on Intervenors’ “numerous proposed conditions.” Although some of the parties in their October 12, 2020 responses and at the October 13, 2020 status conference attempted to identify disputed material issues of fact, those attempts often failed in that they lacked specificity or were argument, assertions of policy, or claims for the imposition of conditions based upon uncertainty regarding the possible future effects of [Frontier’s] restructuring.

Wercinski gave Frontier and the rest until next week to get their plans and paperwork in order. If they do and it meets spec, two days of hearings – instead of the original three days – could be set either for the end of October or the beginning of November.

Or he could decide to skip hearings altogether and rely solely on written evidence and arguments. Either way, the original schedule won’t shift – a decision early next year is still a good enough bet.

California broadband project subsidy requests trimmed, but most might go to the back of the line

by Steve Blum • , , , ,

Sunesys build freedom blvd 625Three revised broadband project grant applications to the California Advanced Services Fund (CASF) were posted over the past couple of days. Two fiber to the premise builds – Frontier Communications’ in Crescent City and Plumas-Sierra Telecommunications’ in the Scott Road area of Lassen and Sierra counties – were trimmed by a few hundred thousand dollars. But another – Hunter Communication’s $290 million proposal in Mendocino County – was slashed to $158 million.

Even so, Hunter’s prospects are dismal. There’s something like $216 million left in CASF, assuming the California Public Utilities Commission approves doubling the tax on phone bills that pays for it. If the CPUC goes ahead with its possible plan to use CASF money to juice up bids for the federal Rural Digital Opportunity Fund (RDOF) auction later this month, top priority will likely be projects that tap into both subsidy programs.

Four current applicants for CASF grants qualified to bid in the reverse auction for subsidies from the Federal Communications Commission’s $16 billion RDOF pot later this month. Hunter wasn’t one of them. Even if it wasn’t asking for three-quarters of the available money, the odds of there being much money left for it are low. First dibs on funding in that area would go to a successful RDOF bidder, if any.

Frontier and Plumas-Sierra, on the other hand, could go to the top of the list. Along with two wireless ISPs that applied for CASF money – Digital Path and Etheric Networks – they were blessed by the FCC.

Of the remaining seven companies that applied for CASF grants last May, four didn’t qualify. There’s no indication that the remaining three, including Hunter, applied, although it’s possible they’re hiding behind a shell company or within a bidding group.

The full list is here.

The new breakdown is:

2020 CASF applicants, as of 14 October 2020

ApplicantProjectsRDOF eligible?CASF grant request
Digital Path11Yes$4,772,019
Etheric Networks1Yes$3,180,330
Frontier Communications10Yes$67,261,816
Plumas Sierra Telecoms6Yes$31,438,450
Charter Communications16?$16,954,563
Hunter Communications2?$166,378,918
Nevada County Fiber1No$552,208
Race Telecommunications4No$21,857,411
Web Perception1No$1,450,697
Total  $400,196,985

FCC proposes to pat its own back for a net neutrality repeal well done

by Steve Blum • , , , ,

In a rush to approve as much of the republican majority’s agenda as possible before next month’s election, the Federal Communications Commission published several draft decisions last week, that will presumably be approved at its next meeting, on 27 October 2020. Included in that batch is a draft of a clean-up ruling that addresses problems a federal appeals court found with its 2017 network neutrality repeal. None of the issues were considered serious enough to nullify the repeal, but the court did tell the FCC to fix them.

The appeals court had four specific objections to the FCC’s net neutrality repeal. Three are addressed in the draft order – impact on public safety, pole attachment rules and broadband’s eligibility for lifeline subsidies, such as those adopted last week by the California Public Utilities Commission:

  • Public safetynothing to see here, move along, move along is the FCC’s response. It went through the bureaucratic motions of reviewing its net neutrality rollback and concluded that it “promotes public safety”. Well, then.
  • Pole attachments – this issue doesn’t impact California, or any other state that regulates its own pole attachments. In the draft, the FCC admits that taking common carrier status away from companies that only provide broadband, and not phone or video service, is a problem in states that use the default federal pole attachment rules, but the damage is inconsequential compared to the totally awesome wonderfulness of its net neutrality repeal.
  • Lifeline – the draft concludes that so long as broadband is delivered over a network that supports phone service, there’s nothing in federal law that prevents subsidising it for low income households. The CPUC’s wireline broadband program bundles broadband and voice service, so no problem there.

The fourth issue – the court’s rejection of the FCC’s blanket preemption of state and local broadband regulations – will stand as is, at least for now. It wasn’t included in the FCC’s net neutrality do-over earlier this year, so it’s not a part of the draft order that’s on the table. California’s defence of its net neutrality law leans heavily on that appellate ruling.

FCC wants to allow cell sites to grow 30 feet in any direction, without meaningful local review

by Steve Blum • , , , , ,

Marina cell sites 625

Local governments will have to automatically permit expansions of cell sites and other wireless facilities beyond currently approved boundaries, if the Federal Communications Commission approves a draft of new wireless facilities regulations. As it all but certainly will – the changes to existing wireless permitting rules are part of a bundle of significant changes to telecommunications policy that the republican-majority FCC has queued up for a vote just ahead of the November election.

As the rules stand now, local governments “may not deny, and shall approve” within 60 days modifications to existing wireless sites that are outside of the public right of way so long as the changes “do not substantially change the physical dimensions of the structure”. Missing the deadline means that the permit is “deemed granted”.

Going outside of existing site boundaries is considered to be a substantial change and local governments are allowed some discretion and longer review times to decide whether or not to issue permit for it.

No longer.

As the FCC wants to redefine it, construction or excavation that’s within 30 feet of an existing site’s boundary is not substantial – it’s “sufficiently modest”, as the draft puts it – and would likewise fall under the “may not deny, and shall approve” mandate, with a 60-day “deemed granted” shot clock.

The primary motivation for the change is the changing nature of wireless sites. More equipment is needed to support more co-located carriers and new technology, particularly 5G technology, the FCC’s draft says.

It’s the second time this year that the FCC has ratcheted down local authority over wireless permits on private property. California cities have already taken the FCC to court over it.

California law is also moving in the same direction. The California legislature approved and governor Gavin Newsom signed, a bill that allows back up generators to be installed within 100 feet of an existing macro tower or base station. Cities and counties effectively have no say over the matter and such construction is exempt from California environmental quality act (CEQA) review.

The FCC is scheduled to vote on the draft at their 27 October 2020 meeting.

CPUC adds broadband to subsidied lifeline phone service in California, if telcos and cable cooperate

by Steve Blum • , , , ,

Forbes ag tech hartnell alisal demo 13jul2107

Low income Californians will be able to get free or low broadband service via the state’s lifeline program, following a unanimous vote yesterday by the California Public Utilities Commission. The plan approved by commissioners is pretty much the same as the draft that was proposed last month. The language in the final version was tightened up, but no substantive changes were made.

Subsidised lifeline broadband service has been available for some time from mobile carriers, who typically provide at no cost to the consumer. Wireline broadband service would come in steeply discounted packages that include telephone service, presumably delivered via voice over Internet protocol (VoIP) technology.

The proposal was developed by commissioner Genevieve Shiroma, who said that it follows from the CPUC’s determination in July that broadband is an essential utility service, no different in that respect than electricity…

We adopted an essential level of broadband service and concluded that [state law] demonstrates that the commission has a role in closing the digital divide in California, and bringing advanced communications services, including broadband Internet services, to all Californians. This program must support affordable choices for Californians across the state, including rural and urban Californians, households and individuals who need no cost wireless service and, of course, for the struggling families who need normal family plans or fixed voice or broadband services.

Governor Newsom also highlighted this need for broadband services with executive order 7320 on broadband for all, to bridge the digital divide in our state…

We really approached this effort that there be equivalency in the kinds of options for the low income customers, because, after all, in energy, everyone gets the same energy. There is a discount for that energy, but it is the same quality of energy.

The big question that has to be answered is whether California’s monopoly model telephone and cable companies will embrace the program. Essential or not, the CPUC has no direct role in regulating broadband service. It can offer subsidies as an incentive, but Shiroma acknowledged that it’s “a voluntary broadband option that our service providers, we think, can meet”.

Comcast doesn’t participate at all in the current life subsidy program for wireline phone service. AT&T, Frontier, Cox and Charter Communications do, but they haven’t said yet whether they will bundle in broadband.

AT&T abandons rural broadband systems as it stops selling 1990s era DSL tech

by Steve Blum • , , , ,

AT&T will no longer sell new connections to old school DSL service, although it claims it will continue to support customers who already have it. It notified customers of the change via the last cycle of bill statements. In one respect, it’s a rational and proper decision – AT&T offers much better service via newer technology – but in another respect it’s bad news: wireline networks in rural communities redlined by AT&T haven’t been sufficiently maintained, let alone upgraded, to support modern systems.

In most, if not all, of those redlined communities, AT&T is the monopoly wireline broadband provider, and it is guarding that exclusivity fiercely and aggressively extracting monopoly rents.

Phasing out 1990s DSL service in favor of newer ADSL2 (2000s vintage) and VDSL (2010s) technology makes sense. It’s slow – at best 6 Mbps download and 1 Mbps upload speeds – and inefficient. Gaining access to access to the faster speeds offered by newer DSL flavors is good for consumers and businesses.

If they can get it.

It’s a big if. Deploying ADSL2 and, particularly, VDSL service means upgrading copper networks that have been decaying for decades in many rural communities in California. It also means pushing fiber deeper into those networks, to handle the increased traffic and to compensate for the shorter ranges associated with modern systems. One advantage of older DSL technology is that it is robust enough to travel (relatively) long distances over crappy wires. The newer stuff is more finicky.

Going by what AT&T has said in the past, and claims to have done in an increasing number of rural communities, ADSL and VDSL upgrades won’t be its solution. Instead, expect more aggressive deployment and selling of low speed, limited capacity wireless service, i.e. its so called wireless local loop technology, which pushes connections based on 4G technology through a small slice of dedicated spectrum to homes and businesses that can receive it.

AT&T has been on this path for many years. It based its successful 2015 bid for federal broadband subsidies on wireless local loop service, and it tried and failed to get the California legislature to give it permission rip out copper networks that no longer meet its return on investment goals and to block regulation of modern systems. But it did convince lawmakers to end an attempt to improve rural broadband service in California this year.

Newsom urged to call lawmakers back to Sacramento to close broadband gap

by Steve Blum • , , , ,

Salinas taco bell broadband

More than 60 people representing nearly as many organisations signed a letter, which was delivered on Tuesday, asking California governor Gavin Newsom to declare a special legislative session to specifically address the growing divide between digital haves and have nots in California…

As leaders in industry, local government, non-profit, education, and media, we represent millions of Californian families, teachers, and older adults, all of whom should have access to the benefits of technology. We urge you to use your authority as Governor to reconvene the state legislature under a special session to pass universal broadband access legislation this year that makes the necessary investments in 21st century access to end the digital divide.

Although Newsom can call a special session and direct lawmakers to return to Sacramento, California governors rarely do. More often, they’ll call a special session during a regular session, to take advantage of quirks in parliamentary procedures. As a practical matter, a governor wouldn’t invoke a special session without the concurrence of legislative leadership. There’s little point to telling assembly members and senators to go back to work unless they want to do so. Once back, legislators set their own agenda and if they’re not of a mind to do something about an issue, they won’t.

So far, only senate leaders – democratic ones; republicans don’t count for much in that regard – have shown any interest in closing the digital divide. Last session’s flagship broadband bill – senate bill 1130 – was killed in the closing days by the top men in the assembly – speaker Anthony Rendon (D- Los Angeles) and majority floor leader Ian Calderon (D- Los Angeles) – after pocketing hundreds of thousands of dollars intense lobbying by monopoly model incumbents.

With the November election less than a month away and politicians of all stripes focused it, don’t bet on an order from Newsom. Post election, a lame duck special session is possible, but unlikely. The new session with newly elected members technically starts on 1 December 2020, but that’s usually just for organisational purposes.

The real action begins next year.

I’ve advocated for SB 1130 and for other useful changes to CASF, and I signed the letter to Newsom. I am involved and proud of it. I am not a disinterested commentator. Take it for what it’s worth.