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No Broadband Stimulus Money for Usage Cappers & Net Neutrality Foes

Phillip Dampier May 12, 2009 Editorial & Site News, Public Policy & Gov't 3 Comments

cashOne of the biggest anti-consumer disasters of the last 15 years was President Clinton’s signing of the 1996 Communications Act.  This bought and paid for legislation deregulated a major part of the telecommunications sector with the idea that the “free market” would somehow provide sufficient checks and balances to protect against media concentration, monopoly abuse, and locking out technological advancement wherever robust competition was unlikely.

How’s that working out for you?

Consolidation and corporate control of broadcasting, telephony, broadband, and other communications services has been rampant and largely unchecked by the Federal Communications Commission during the last 10+ years.  The result is a handful of players controlling the services we all depend on in our daily lives.  Usage caps and overpriced tiered billing is just the latest example of market concentration.  Companies realize consumers have few options for equivalent services, so they can dictate the terms and conditions with almost no oversight or control.  Local and state governments confronting this issue have come to realize their hands are tied, because telecommunications deregulation without assurances of a competitive marketplace always equal monopolistic behavior.

Net neutrality has also been a victim of a hands-off regulatory authority that is supposed to foster competition, equity in access, and prohibit abusive behavior.  The Federal Communications Commission has failed on every front.

The Obama Administration is preparing to fund initiatives to secure America’s broadband future at a time when this country has fallen well behind others in the world in affordable access, fast speeds, and no draconian usage capping.  Lobbyists for big telecommunications companies are already contemplating just how big their piece of the pie should be.  Many of the same astroturfing groups outraged about municipal broadband networks are oddly quiet about the multi-billion dollar potential transfer of taxpayer dollars to these private corporations to “enhance broadband service” in underserved areas of the country.

Obviously, most of these corporations that will  seek taxpayer funds are already advocating for as few limitations on how those funds are spent as possible.

It’s time for consumers to speak up about how their taxpayer dollars are going to be spent on broadband development.  Many of the original goals for broadband stimulus spending are honorable — getting broadband access into rural and suburban communities that are ignored by private providers, enhancing the quality of those networks to provide modern speeds and a platform for future enhancements, and finding ways to get access into disadvantaged communities.

However, there is also a serious risk that millions upon millions of dollars could be flushed down rat holes or wasted by parties that don’t need the money.  As with any major pot of money, an entire industry of industry lobbyists and consultants will pour over the terms and conditions for obtaining a piece of that money pot, and every interest you can imagine will be tailor-writing grant applications to cash in.  Some will be for valuable projects to expand broadband access.  Others, however, will be for useless “studies” done by groups that live on the money spent to conduct the study,  “demonstration projects” that exist solely because money for them is available, and politically-connected funding designed to gain favor from constituents.  Some private companies will seek government funds to embark on projects they might have funded with private dollars before the “money pot” became available.

One need only look at the colossal waste and abuse of the FCC-mandated Universal Service Fund telephone customers are forced to pay every month.  Billions of dollars have ended up going for anything but providing guaranteed telephone access for the nation’s most rural residents.  The USF has funded projects in Beverly Hills, California and suburban Washington, DC, hardly poverty stricken or rural.  Just last month, the Memphis school district managed to rack up $622,733 in mobile phone bills for more than 1,000 mobile phones handed out to district staff members, paid for from USF funds.  They used to the phones to call psychic hotlines, sex chat lines, order ring tones, and run up personal long distance calls to friends and family members.  Memphis isn’t exactly a rural community, either.

Consumers can get involved to make sure these funds are spent wisely.  We need to insist that they not be given to any group that does not have a concrete, shovel-ready project to begin the infrastructure development we need to get America’s broadband network at a level at least competitive with the Republic of Korea.  Here are the requirements you should be insisting from Congress:

  1. Providers receiving funds must construct a network capable of providing broadband speeds at least at the 5Mbps rate, with the capacity to expand and grow those speeds in the future;
  2. Providers must agree not to impose usage caps or limits based on consumption if they are receiving public dollars to help defray bandwidth expenses.  Reasonable speed based tier pricing is acceptable;
  3. Providers must agree to build their networks to urban, suburban, and rural communities within their service area, reaching all areas within a reasonable, date-certain time frame.
  4. Providers must agree to the principles of net neutrality, providing open and equal access to all Internet services (excepting those prohibited by law) without throttling, blocking, or limits.
  5. Funds must be used exclusively for approved projects and accounted for appropriately.
  6. The ultimate goal of the project must be to promote competition and prohibit any limitations on competition from any sector willing/able to provide it, public or private.
  7. Where competition does not exist, appropriate government oversight and/or regulation to provide for consumer protection from abusive business practices must be included.

Stop the Cap! sees broadband stimulus funding as a potential solution to consumers in rural areas already living under draconian usage caps, slow speeds, and service limitations.  Rural communities should not be penalized with 20th century access, particularly when a significant amount of government-mandated funding from you and I already goes to these rural providers, often telephone companies.

Currently there are 3 comments on this Article:

  1. BrionS says:

    Quick comment (very common mistake): it’s “pore over” not “pour over” (http://idioms.thefreedictionary.com/pore+over).

  2. Lummox JR says:

    Unfortunately I think this suggestion, while good, will fall on deaf ears. Caps are one issue uniting people of all ideologies–another is wasteful spending. The many stimulus and bailout plans have so far amounted to little more than throwing money blindly at problems and hoping it sticks. “Don’t give my tax dollars to chumps who don’t deserve it” has been a major theme of taxpayer anger directed at both parties, and our politicians in both parties continue to write those checks.

    At least with some people already involved in this (Rep. Massa and Sen. Schumer in particular), maybe this could get a hearing and at the very least tie up any potential stimulus in red tape. As much as I’d love to see money allocated to municipal broadband services or improving rural access, I fear that stopping the gravy train is the game we’re playing for. If broadband gets a piece of the dole, it will certainly be without oversight, without accountability, and with minimal restrictions. I’d rather keep cajoling our lawmakers into making net neutrality and no caps the law of the land.

  3. Michael Chaney says:

    The ARRA of 2009 (stimulus bill) has actually tasked the FCC to come up with the National Broadband Plan that will be used to determine who gets the money. The FCC has requested input from the public on what should be included in this plan. I suggest that everyone reading this article right now submitt your comments to the FCC. At the very least, copy and paste Phillip’s seven requirements into your comment and submitt them. This will let the FCC know that these seven pillars of fair practice are being echoed by the public.

    Here’s a link to the big picture of the FCC’s role in all this:

    Here’s a link to the National Broadband Plan Notice of Inquiry:

    And here’s a link to the online comment submission form:

    This online submission is super easy and only takes seconds to complete

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