Mobile carriers tell FCC to set ridiculously low national price for local property rentals

by Steve Blum

Sprint thinks $50 per year is a “presumptively reasonable” rent for a city light pole. In a meeting with key FCC staff, Sprint representatives pushed for new federal rules that would set, in effect, the maximum rates that local governments can charge for leasing light poles and other city property to mobile carriers.

Besides the $50 annual lease fee, Sprint’s suggested reasonable fees include a $500 per batch cap on application fees, and a $50 per year limit on the annual charge to plant a utility pole or other equipment in the public right of way (that’s not an issue in California; telecoms companies get right of way access for free here).

What Sprint wants is ridiculous. Even the California legislature’s gift to wireless companies last year – senate bill 649 – would have allowed cities to charge up to $250 per year to rent out pole space. Would have, if governor Jerry Brown hadn’t vetoed it because it was tilted too far towards wireless companies.

The FCC is getting similar advice from other mobile companies, including Verizon and T-Mobile (h/t to FierceWireless for the pointer). Both companies asked the FCC to preempt local property rights and set artificially low prices for pole rentals.

Local pole leasing policy is also on the agenda for the FCC’s industry-dominated broadband deployment advisory committee, which will probably issue its final recommendations in the next few months.

I’ve been collecting pole lease rate data from around California, and it shows an average rate of $900 per year. It’s not a scientific sample – I get the data where I can – but it shows a couple of things: pole lease rates are no different than any other real estate pricing and vary greatly by location, and mobile companies are willing to pay hundreds and even thousands of dollars a year for a single pole, when the business need is there. In other words, the market works.