California assembly votes to throw broadband speeds into reverse

5 June 2017 by Steve Blum
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The California assembly voted to lower the state’s minimum Internet standard to 6 Mbps download and 1 Mbps upload speeds. By a vote of 67 to 5, and with eight members abstaining, assembly bill 1665 was approved and sent onto the senate last week. It only needed 54 yes votes to pass. All five noes and eight abstentions came from republicans, but a dozen others joined with democrats to vote in favor.

AB 1665 reinstates a tax on phone bills that’ll pay for adding $330 million to the California Advanced Services Fund (CASF), the state’s primary broadband infrastructure subsidy program. It also makes amendments to the rules that govern how the $300 million specifically earmarked for infrastructure will be spent; all are changes designed to protect incumbents – primarily AT&T and Frontier Communications, but also cable companies – from competition.

The big change is to the minimum speed standard. Right now, a community is eligible for a CASF infrastructure grant if there’s no service available at the 6 Mbps down/1.5 Mbps up level. Dropping the upload standard to 1 Mbps has two main effects: Frontier and AT&T can continue to use older generation DSL technology and areas where the federal Connect America Fund subsidises Internet services at 10 Mbps down/1 Mbps – most of rural California – will be out of bounds. The bill also has language that further restricts spending in federally subsidised, low speed areas, allows reimbursement of some operating expenses, and makes it possible for cable companies to avoid regulatory oversight by funneling money through property owners.

The net effect would be to knock independent, competitive ISPs and middle mile fiber operators out of the running in rural areas of California. Projects like the middle mile fiber routes through the Salinas Valley or along the eastern side of the Sierra Nevada will no longer be possible. Whether or not that happens is now in the hands of the California senate.