Don’t expect fiber or 5G in rural communities, FCC commissioners say

by Steve Blum • , , , ,

John deere booth ces 7jan2020

Fiber and mobile 5G are fine for cities and suburbs, but rural communities can look forward to satellites and fixed wireless broadband service, according to the Federal Communication Commission’s republican majority. Speaking at CES in Las Vegas this week, FCC chair Ajit Pai, republican commissioners Michael O’Rielly and Brendan Carr, and their democratic colleague Geoffrey Starks were upbeat about 5G, fiber and, as Carr put it, the “new wave of innovation and services”.

But that wave will only break on urban and suburban beaches, at least via conventional broadband service.

“To say we’re going to have fiber throughout the United States is both not realistic – it’s not technically doable”, said O’Rielly. “There are communities where satellite service is the exact answer”.

Pai said 5G infrastructure that connects a smartphone to fast broadband access – the standard 5G use case – will be built in cities and suburbs. Rural 5G deployments will support other services – fixed wireless broadband, for example – that might or might not be offered by mobile carriers on mobile spectrum. His rural broadband advisor, Preston Wise, who spoke on a rural 5G panel, said the rebooted version of the FCC’s primary broadband subsidy program – now called the Rural Digital Opportunity Fund – will be used “to deploy fixed broadband in parts of rural America”, although he held out the possibility that some of the money would go toward fiber to the premise (FTTP) projects.

Rural FTTP doesn’t fit very well into the business plans of incumbent monopoly model telecoms companies. Rural electric cooperatives, on the other hand, are deploying fiber. Pai hopes to encourage rural utility co-ops to apply for FCC subsidies – he said he doesn’t care which broadband carriers get the money.

I hope that’s true. Although electric co-ops and wireless operators figured prominently in the last round of FCC broadband subsidy auctions, they were only allowed to bid on communities that AT&T, Frontier Communications and other legacy telcos didn’t want to serve.

Legacy telcos were given a right of first refusal and they exercised it. Satellite and fixed wireless fit their rural business plans perfectly. Letting them dictate rural broadband technology choices, as O’Rielly seems happy to do, will lock in a deep divide between rural and urban communities for many decades to come.

Newsom’s broadband budget language doesn’t translate to infrastructure

by Steve Blum • , , , ,

San benito pole route 13apr2019

Broadband references are sprinkled into California governor Gavin Newsom’s state budget proposal but, taken at face value, he’s focused on shifting money from hard capital infrastructure projects to soft programs and annual operating budgets.

Although tagged as an infrastructure investment in Newsom’s budget summary, his “Broadband for All” initiative is about operations, comprising four elements: mapping, education spending, “optimising” existing resources and “prioritising connectivity across executive actions and policies”.

The California Public Utilities Commission already has a fine mapping program, which Newsom wisely intends to expand. It’s the brightest broadband item in his budget. If the CPUC is allowed to combine availability data with comprehensive network maps, inventories of state owned facilities and construction cost data, and make it public, then independent broadband infrastructure projects become more feasible.

Feasible, but not funded.

Consistent with past practice, Newsom proposes to spend $261 million on broadband facilities and information technology acquisitions for schools over the next five years, which is praiseworthy (as are many other items in the $153 billion budget) but has rarely improved broadband infrastructure that’s directly available to consumers and businesses. Keeping broadband top of mind in state government is likewise a good thing, and when agencies look outward and cooperate with private sector telecoms companies – Caltrans’ dig once program is a good example – the general public benefits. More often, though, connectivity improvements are limited to meeting agencies’ internal IT needs. Still, it’s a step in the right direction.

It’s Newsom’s third bullet point – “optimising use of existing resources” – that threatens to divert what little money California spends on general broadband infrastructure development to other purposes. As his budget summary explains…

Informed by GIS-based mapping, the state will review existing fund sources available for broadband adoption and activities. This review will include the California Teleconnect Fund, the California Advanced Services Fund [CASF], and federal funding opportunities to maximize the return on existing investments. In total, these funds provide approximately $900 million over the next five years that can be targeted to critical broadband activities statewide.

The California Teleconnect Fund subsidises broadband service for schools and other organisations. Federal broadband funds are speculative at best – so far, California is shut out of the federal agriculture department’s newest broadband infrastructure subsidy program.

What’s left is CASF. Which holds the only money – somewhere around $300 million – that California earmarks for general broadband infrastructure construction. Which isn’t specifically listed as one of California’s “critical broadband activities”.

Adoption – digital literacy and broadband subscriber acquisition programs – gets a mention. Schools are in for a lot of love. Libraries and state IT departments get a nod too. Broadband for businesses and consumers? Nada.

Schools and community programs are wildly popular; government operations are Sacramento’s core business. Subsides for independent broadband infrastructure are neither, and are opposed by monopoly model incumbents who pay lawmakers millions of dollars to pay attention. Newsom’s budget offers no challenge to that status quo.

WiFi and 5G win spectrum that the satellite and car industries lose

by Steve Blum • , , , ,

Pai shapiro 1 ces 7jan2020

Despite his enthusiasm for federalising any policy that touches on telecoms, big footing state and local governments isn’t at the top of Federal Communications Commission chairman Ajit Pai’s 5G wish list. Pai and three of his fellow commissioners spoke at CES in Las Vegas earlier this week. When asked about the main barriers to widespread deployment of 5G broadband service, Pai listed cost, spectrum and the availability of trained construction crews.

Although there’s not a lot that a telecoms regulator can do about workforce training or construction costs, spectrum availability is the FCC’s core responsibility.

Pai promised to “push” more frequencies, licensed and unlicensed, into the broadband market. But opening up new spectrum for broadband means taking it away from or sharing it with other users, which quickly devolves into a zero sum game in Washington, D.C.

The satellite industry stands to lose 280 MHz of spectrum in the 3.7 GHz to 4.2 GHz ranges – AKA the “C” band. The FCC plans to auction off those frequencies to mobile carriers for exclusive, licensed use, presumably later this year.

The FCC has a plan to repurpose 45 MHz in the 5.9 GHz range, transferring it from the automotive industry and opening it up for WiFi and similar unlicensed uses. Carmakers “had not lived up to the promise” of their 75 MHz of dedicated short range communications (DSRC) spectrum, said Geoffrey Starks, the lone democratic commissioner to speak at CES. The FCC’s plan would assign 20 MHz of the balance to cellular-type vehicular communications – C-V2X in the jargon – and maybe leave 10 MHz for whatever uses the automotive industry eventually develops for DSRC. Or maybe not – WiFi has a huge fan base.

Sharing is contentious in D.C. because it’s often federal agencies that are being asked to give up exclusive use of frequencies they’ve had to themselves for decades. “I’ve learned in Washington there are three things you don’t discuss three things in polite society, religion, politics and sharing of spectrum”, Pai said.

California’s consumer privacy law is a call to action for federal regulators

by Steve Blum • , , , ,

Flashers

Federal Trade Commission chair Joseph Simons was on the undercard for Consumer Technology Association CEO Gary Shapiro’s “fireside chats” with federal policymakers at CES in Las Vegas on Tuesday. Warming up the audience ahead of Federal Communications Commission chair Ajit Pai’s long awaited CES debut, he urged congress to give his agency the U.S. privacy cop job that California now holds by default. The FTC is already pursuing privacy enforcement actions under existing law “because the big tech platforms are becoming so consequential to our lives and so large”, Simon said.

Simon favors federal privacy legislation over the state by state approach. “Of course, now we’re dealing with California”, he said. There’s a place for state-level consumer privacy legislation, but “it depends on how the states evolve and how the federal law evolves”. So long as a state law tracks with federal requirements he seems to be okay with it, but if it doesn’t he wants congress to step in. In other words, states can tinker with the details so long as they stay in the federal privacy policy sandbox.

There is bipartisan agreement in Washington, D.C. that the sandbox should be built, but democrats and republicans disagree on a couple of key issues. Two FTC commissioners – democrat Rebecca Slaughter and republican Christine Wilson – took part in a separate panel discussion later in the day. They both favor federalising consumer privacy rules. Wilson said that California’s privacy law, along with the European Union’s privacy regulations, makes federal action urgent “because interoperability is needed”.

They disagreed about a couple of key details, which largely define the partisan gap on privacy legislation: whether congress should completely occupy the field and preempt states and whether private individuals – in reality, trial lawyers – should be able to sue companies that don’t follow the rules. Democrats, like Slaughter, tend to say yes to both; republicans, like Wilson, are on the no side.

FCC promises more of the “P-word” – preemption – in 2020

by Steve Blum • , , , ,

Line to see pai ces 7jan2020

Due to the nature of the program, you’re going to have to go through metal detectors.
CTA staffer to long queue waiting to see Ajit Pai.

Ajit Pai made his first appearance at CES as chairman of the Federal Communications Commission yesterday, sitting down for a talk about the coming year with Gary Shapiro, the CEO of the show’s organiser, the Consumer Technology Association. Much of the conversation was about 5G infrastructure, and the public policy that surrounds it.

More preemptions of local and state authority over wireless sites, utility poles and the use of the public right of way are on the FCC’s agenda. Pai reiterated his belief that wireless policy should be made at the federal level, including policy that’s traditionally in the hands of states and local governments.

“We want to see a consistent, easy to understand set of regulations that anyone can innovate around”, Pai said. Mobile carriers and infrastructure companies want “a consistent level of regulation” as they build out 5G networks. Which means rules should be set by the FCC and not state legislatures or city councils. Pai intends to “encourage” state and local governments to approve permit applications small cell sites and other wireless facilities. “Multiple layers of government” are “not conducive to infrastructure investment”, he said.

His wingmen in the FCC republican majority echoed his comments. Commissioners Michael O’Rielly and Brendan Carr, along with democratic commissioner Geoffrey Starks, took part in a panel discussion later in the afternoon at the Las Vegas show. O’Rielly put it bluntly…

It’s not just small cells. It’s going to mean more macro towers. That means dealing with difficult issues on placement when states and localities want to either extract too much money or try to dictate what services will be offered. That’s problematic and I’ve been talking about this for a long time. It does come with the P-word, which is – it requires preemption. And that is something the commission is going to have to continue to do.

Cities and counties should expect more “bold actions”, as Carr put it, from the FCC.

5G adoption begins a slow ramp up in the U.S. in 2020

by Steve Blum • , ,

Cta 5g projections 5jan2020

Source: CTA

Mobile 5G broadband service adoption starts to grow in the U.S. in 2020, but it won’t be a breakout year. A couple of near term 5G market predictions were offered at CES in Las Vegas over the past couple of days, by the show’s organiser, the Consumer Technology Association (CTA) and by Qualcomm, which is the mobile industry’s primary chipmaker. Taken together (and at face value), the picture that emerges is of a global 5G market that 1. will launch for real over the next 12 months and 2. won’t be U.S.-centric.

Qualcomm predicts that 200 million 5G smartphones will be produced worldwide in 2020, growing to 750 million units shipped in 2022. CTA’s projections of annual smartphone shipments pegs the U.S. 5G handset total for 2019 at 1.6 million units and predicts 20.2 million 5G smartphones shipped in 2020.

Those are estimates of the pipeline, not the installed user base. Yet.

Although historical seasonal consumer electronics sales patterns have weakened, particularly for telecoms-related products, manufacturing ramp up rates still operate on a upward curve. The biggest chunk of the annual output for a new product will come in the last three or four months of the year, and it takes time for products to move from the factory loading dock to a consumer’s hands. So CTA’s shipment projections for 2019 are an indication of what the U.S. 5G user base will be by, say, mid–2020.

In very round numbers, that means less than 1% of U.S. mobile broadband subscribers will have 5G-capable smartphones in their hands by mid–2020, and less than 10% by mid–2021. For the next three years, CTA predicts that smartphone makers will be pumping out more 4G smartphones in the U.S. than 5G ones. It won’t be until 2022 that 5G overtakes 4G unit shipments, so 5G consumer smartphone upgrades won’t outstrip 4G handset upgrades until 2023.

CTA’s timeline for 5G smartphone production tracks with U.S. mobile carriers’ likely 5G deployment rate. Although carriers continue to hype their 5G build outs – and those build outs will accelerate in 2020 – widespread availability in the U.S. is still three to five years away.

It’s a different story in Asia. Qualcomm talked a lot about Chinese manufacturers at its CES press conference. Asian carriers, particularly in South Korea, are aggressively deploying 5G infrastructure. That would seem to be where the bulk of next year’s 200 million 5G smartphone shipments will go.

Wearables graduate from accessories to hardware platform status as CES opens

by Steve Blum • , ,

Smart watch

CES is underway in Las Vegas. What used to be called the Consumer Electronics Show but now goes by the less modest appellation of “CES 2020, the world’s largest and most influential technology event” kicked off this weekend with pre-show and preview events. Today is press day and the show floor opens tomorrow.

From a product perspective, the consumer electronics technology industry is collapsing into a handful of all purpose products – smart phones, cars, and computers and big screens of one sort or another. That list will grow this year as wearables become full featured hardware platforms that can support complete ecosystems of apps, services and content.

The wearables market is about form factor, not specific device function. That’s true whether it’s smart watches, fitness trackers, sleep monitors or something else. Smart phones are networked, handheld computers that are a convenient parking spot for any app, sensor or content that you can imagine. It’s an accident of history that we call them phones. Similarly, what we’ll end up calling a smart watch will just be a wrist-mounted platform for whatever can conveniently ride on it. I’m seeing fewer and fewer Fitbits and other dedicated fitness wearables on people, and more and more Apple watches, which are often used for step counting and other fitness tracking purposes.

Batteries are the major limiting factor inhibiting the collapse of everything into a single smart watch. There are two problems: battery life and recharging. So far I haven’t found a smart watch that can operate with everything running, including GPS, for more than about eight hours straight. That’s inconvenient for people who just want to put it on in the morning and let it do its thing all day long. It’s a deal killer for people who need that level of functionality for long durations – cyclists, hikers, triathletes for example. Recharging requires users to take the watch off once or twice a day and leave it somewhere to charge. That can limit its usefulness as a sleep monitor, for example. It is also a lot more fussy than we’re used to being about our watches.

But there’s a potential solution to both problems. If someone can figure out a system for wirelessly recharging smart watches with ambient energy, it’ll be a game changer. At that point, it won’t be just fitness trackers that collapse into smart watches, but also many smart phone functions as well. Maybe a low level magnetic field on keyboards, steering wheels, handlebars or anything else that’s regularly near your wrist for more than a few minutes a day?

AT&T faces contempt hearing as CPUC defines VoIP regulatory role

by Steve Blum • , , , ,

Bluto pencils

The first shot in what could be the defining regulatory battle over broadband in California was fired in the closing days of December by the California Public Utilities Commission. An administrative law judge (ALJ) ordered AT&T

To show cause, if any, why [AT&T] should not be:

  1. Found in contempt of [a 2019 CPUC decision regarding disaster preparedness].
  2. Found in violation of the Public Utilities Code and [a CPUC rule requiring telcos to file price/service terms (aka tariffs)].
  3. Fined, penalized, or have other sanctions imposed for failing to comply with a Commission decision, [commission rules], and the Public Utilities Code.

The dispute began last Spring when CPUC demanded that AT&T file a notice – an “advice letter” – detailing its terms for “Next Gen” 911 service, which will run over an Internet protocol connection, like other Internet data, rather than using legacy copper network switching and other 20th century technology.

AT&T first blew off the demand, and then said it’s none of your business

[Mark Berry, AT&T regulatory director] spoke with [CPUC] staff and relayed the following in response to the question of why AT&T had not filed an advice letter:

  1. AT&T does not offer the services referred to in the letter and even if it did offer these services, AT&T does not agree that the CPUC can require a tariff because under [a now expired public utilities code section], the CPUC does not have authority to regulate IP-enabled services.
  2. If AT&T offers Next Gen 911services in the future, it will not file tariffs because the CPUC does not have authority over these services.

The CPUC and AT&T exchanged more such pleasantries, until AT&T finally filed some paperwork, without answering the questions asked. So AT&T executives were ordered to appear at a hearing later this month to explain themselves.

This kind of arm wrestling over filing and disclosure requirements is nothing new. Business as usual would be a good description, although it usually doesn’t get this far. This case is significant because the primary legal basis for AT&T’s refusal expired at the end of 2019. It was a law enacted in 2012 that banned the CPUC from regulating Voice over Internet Protocol (VoIP) or other “Internet protocol enabled” services. Back then, VoIP was still a developing technology, and telcos and cable companies hadn’t gone all in on it as a replacement for legacy copper service and as a way to get out from under the regulatory oversight that comes with it.

AT&T and other monopoly model telecoms companies tried to get the ban extended last year, but ran into a brick wall in Sacramento, also known as the Communications Workers of America. The betting is that they’ll try again this year – why spend billions on service quality when a few million in the pockets of lawmakers will get you off the hook?

So it’s up to the CPUC to figure out how VoIP fits into California’s regulatory ecosystem. One way the commission can do that (relatively) quickly is to litigate disputes like this one, and bake new case law into the resulting decision.

Privacy is now a Made in California product

by Steve Blum • , , , ,

California’s data privacy law took effect yesterday, although formal regulations and active enforcement by the attorney general’s office don’t kick in until July. Even so, the AG plans to respond to complaints and monitor compliance with the bits of the law that do have teeth now. Until – unless – congress does something, the California Consumer Privacy Act (CCPA) is the national standard.

If you want confirmation, just look in your email inbox. If it’s anything like mine, it’s full of CCPA notifications. A similar flood of messages happened when the European Union’s data privacy regulations took effect last year. The notices were sent regardless of whether a customer lived in the EU or not, because it’s easier and safer to apply a single standard to everyone when it’s practical to do so. In the U.S., the path of least resistance is complying with California’s standard.

Microsoft certainly agrees

We are strong supporters of California’s new law and the expansion of privacy protections in the United States that it represents. Our approach to privacy starts with the belief that privacy is a fundamental human right and includes our commitment to provide robust protection for every individual. This is why, in 2018, we were the first company to voluntarily extend the core data privacy rights included in the European Union’s General Data Protection Regulation (GDPR) to customers around the world, not just to those in the EU who are covered by the regulation. Similarly, we will extend CCPA’s core rights for people to control their data to all our customers in the U.S.

Google jumped on California’s bandwagon, too. Its CCPA-compliant tools are available worldwide.

Although there seems to be general agreement in Washington, D.C. that something must be done, there isn’t consensus on what that something will be. The big question is whether or not to preempt state privacy laws and impose a single, national standard. A bipartisan draft produced by a house of representatives committee doesn’t offer an answer, because it’s still a partisan issue. Which means California might set the standard for some time to come.

Internet regulation is at the top of California’s 2020 policy wish (or wish not) list

by Steve Blum • , , , ,

2020 might be the year that the State of California figures out what, if any, role it will play in regulating (or not) broadband service and infrastructure. As of tomorrow, the California Public Utilities Commission is no longer barred from regulating services like VoIP (voice over Internet protocol). A 2012 state law that said the CPUC couldn’t do that expired at the end of 2019.

But that doesn’t mean that anything is decided.

AT&T and its fellow monopoly model Internet service providers tried to get an extension of that ban approved in the California legislature this year. Assembly bill 1366 made it through the gauntlet of committee hearings to pass in the assembly and nearly reach a floor vote in the senate. It was finally stalled by opposition from the Communications Workers of America – organised labor contributes even more money and other kinds of support to California politicians than cable and telephone companies.

Stalled, but not stopped completely. AB 1366 can be resurrected next month, or a new bill can be written that would accomplish the same thing. Or maybe come at it from a different direction.

AB 1366 didn’t address broadband service as such. It’s about “Internet protocol enabled” services – anything that rides on top of broadband service – although regulations for a top level service could have implications for the underlying broadband service too. It would have extended an existing ban on IP-enabled service regulations by any state agency or local government. That could mean anything from Facebook to email to Netflix to Google search, which arguably shouldn’t be regulated at the state level. It also means VoIP, which is voice telephone service that runs on top of unregulated broadband service rather than via the old dial up, regulated phone network, AKA “plain old telephone service” (POTS).

A 2019 federal appeals court ruling allowed state-level regulations, although to what extent is still an open question. California already has Internet regulations on the books – a 2018 bill imposed network neutrality rules on ISPs. Enforcement, which is in the hands of the California attorney general, is stalled until federal court challenges are resolved. But the door is now open. Whether, and how, California lawmakers walk through it is top of the broadband policy watch list for the new year.