California edges closer to full pole and conduit access for ISPs

8 May 2015 by Steve Blum
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In two separate, unanimous decisions yesterday, the California Public Utilities Commission narrowed the privilege gap between pure Internet service providers and traditional telephone and cable companies, at least concerning access to utility poles, conduits and other facilities and right of ways.

In one decision, the CPUC handed Google Fiber a victory by ruling that a company that has a state franchise to deliver television service over any kind of cable or wire (but not wirelessly) is a “cable television corporation” under California law and can ask for equal access to utility poles…

A state-franchised that transmits television programs by cable to subscribers for a fee is a “cable television corporation” as defined by [California’s public utility laws].

The term “cable”…applies to any type of cable facility (e.g., coaxial cable, fiber optic cable, or wired facility) that is used to transmit television programs to subscribers for a fee, regardless of whether the “cable” is also used to provide other services (in addition to transmitting television programs) such as broadband internet service. The term “cable”…does not include satellites and other forms of wireless transmission.

Which means that all Google Fiber needs to do in order to get the same kind of utility pole and conduit access in California as Comcast is to rock up to AT&T or PG&E and say, hey, we have a franchise and offer 120 channels of TV, so we’re a cable company too.

The decision is a bit convoluted. It actually starts out by denying Google the kind of pole attachment permission it originally asked for, but then says it doesn’t need it: cable television corporations already have pole access and that’s what Google is.

In yesterday’s other decision, the CPUC ruled that an ISP is a telephone company, even though it doesn’t have current plans to provide phone service. Bright Fiber Network submitted a still-pending application for a subsidy to build a fiber-to-the-home system in the Nevada City area more than two years ago. It applied for certification as a regulated telephone company at the same time because the source of the money, the California Advanced Services Fund (CASF), required it back then.

Initially, Bright Fiber had no plans to provide phone service over its FTTH network, which was intended to only deliver gigabit Internet access to homes and businesses. That was a problem, because it wasn’t proposing to also offer middle mile service, as another ISP did when it successfully gained certification in 2013. There was no way to bridge the gap between its broadband-only last mile business model and commission rules regarding phone companies.

It’s an important issue, because even though CASF rules no longer require certification, having it confers privileges, as the commission’s decision noted…

Bright Fiber…applies…in order to have access to “conduits, ducts, poles, wires, cables, instruments, and appliances, and all other real estate, fixtures, and personal property owned, controlled, operated, or managed in connection with or to facilitate communication by telephone, whether such communication is had with or without the use of transmission wires”.

In other word, Bright Fiber needs certification – a certificate of public convenience and necessity – to get in utility conduit or on poles.

The solution was for Bright Fiber to promise to provide phone service “as soon as it has sufficient customer base” to support it, without having to define what that point might be. Even that fudge didn’t initially meet CPUC requirements and an administrative law judge recommended rejecting the application. An alternative decision drafted by commissioner Catherine Sandoval expanded the conventional rules enough to encompass Bright Fiber’s plans and the other four commissioners embraced it.

It’s not open season on utility poles yet for Californian Internet companies, although the FCC’s decision to regulate broadband infrastructure and service under common carrier rules might eventually do that. Some legal limbo dancing is still needed to gain access, but after yesterday’s decisions the regulatory contortions will be a lot less painful.

Tellus Venture Associates assisted with the Bright Fiber CASF application, among others, so I’m not a disinterested commentator. Take it for what it’s worth.