Speed doesn't matter so give us the money, Verizon tells FCC

15 August 2016 by Steve Blum
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Will the cherries blossom in Washington?

Verizon wants the Federal Communications Commission to give it an open and privileged path to do an end run around the statewide service obligations attached to the current round of Connect America Fund (CAF-2) rural broadband subsidies.

In comments it filed regarding the FCC’s proposed bidding rules for the next round of CAF-2 subsidies, Verizon wants extra credit given if it makes minimum service – 10 Mbps down/1 Mbps up – bids for unserved areas it turned down last year, but doesn’t want competing bids to be given greater weight if higher, even gigabit, speeds are offered, because, well, who needs all that bandwidth…

For every location in the gigabit tier that is awarded support because of a large weight, several other eligible locations would be left without any broadband service whatsoever. These customers would have been well served by services offering the “baseline” speeds and capabilities, which are sufficiently robust to support most consumers’ online activities.

What’s doubly disingenuous about Verizon’s comments is that it’s trying to game the system so that it can cherrypick the rural communities in its service territory that it deems sufficiently lucrative to upgrade. In the first round of CAF-2 subsidies last year, Verizon could have had those subsidies handed to it on a platter, if it agreed to upgrade all eligible locations in a given state.

Verizon said no, preferring instead to come back later and bid on the particular areas it wants to serve. As it’s entitled to do. But the FCC shouldn’t let Verizon use its existing monopoly advantage to all but automatically claim cherrypicked communities and lock them into the lowest tier of service, while ignoring the rest.