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Cable Industry Prepares Solution for TV Password Sharing Abuse

Phillip Dampier April 4, 2018 Consumer News, Online Video Comments Off on Cable Industry Prepares Solution for TV Password Sharing Abuse

A company is testing a solution to video subscription password abuse that will register each device authorized to access streaming video, while giving customers a Forever Login, ending the need to regularly re-enter usernames and passwords to watch.

Synacor is responding to growing concerns from some in the cable industry that subscription television password sharing is allowing unauthorized access to content viewers did not pay to view. The new system is an attempt to upgrade the authenticated TV Everywhere experience to reduce subscriber inconvenience while locking down the number of concurrent devices allowed to view online content.

Currently, when a customer accesses subscription-required content online, they are asked to select their TV provider and then enter their assigned username and password to verify they are a current subscriber to a video package that includes that network. Once authenticated, the network’s website controls how long user credentials are kept before they must be re-entered, as well as how many concurrent viewing sessions from multiple family members are permitted.

TV Everywhere services were originally designed to allow the subscriber and anyone else living within the home to be able to access networks like CNN, HBO, ESPN, and others on portable devices in-home and while on the go. But many customers also share their user credentials with extended family members and friends who do not live at the same address. Unauthorized third parties also occasionally obtain user credentials through brute force hacking and sell them on the black market. The subscriber usually only discovers a security problem with their account when they reach the concurrent viewing limit, which displays as an on-screen message stating the maximum number of viewers are already watching content through a subscription and at least one must disconnect before a new stream can be viewed.

Cable company executives hold a variety of opinions about the seriousness of password sharing. Altice and Comcast, and programmers like Time Warner, Inc., which owns HBO and Cinemax, have not shown much concern about the practice, but Charter/Spectrum executives have, and are leading the charge to lock down subscriber authentication.

Synacor’s new system introduces a new layer of cable company-defined limits on streaming: registering each device allowed to view content as well as checking how many people are attempting to stream content simultaneously.

Under the new system, a customer will be permitted to register a limited number of “trusted devices” allowed access to streamed video content. A cable company, for example, could limit subscribers to two smartphones, one tablet, and one smart/internet-enabled TV or Roku box. Even if the subscriber has other devices, they would have to unregister an existing device before being allowed to register a new one. Additionally, a cable operator could limit concurrent streams to two or three, either per network or per account, regardless of what networks are being watched. That would mean, in one example, a family of four would designate a maximum of five “trusted devices” and be allowed to watch up to three concurrent streams per account. “Bill” could watch ESPN on the bedroom television, “Mary” could watch a murder-mystery on the Hallmark Channel on her tablet on the patio, and “Dylan” could watch a movie on HBO on his phone at the same time. But if “Sara” decided to watch a show on Lifetime on her phone, the system would block the request.

In the past, it was likely all four family members could watch concurrent streams of their shows on virtually any device they like, and they could also share login credentials with “Jeff” — a family member at college, who in turn shared his username and password with the other people living in his dorm room — exactly the kind of thing Charter CEO Thomas Rutledge would like to stop.

Synacor claims its new system is still a positive for consumers because it allows user credentials to be stored in perpetuity, ending the need for frequent logins to re-verify and re-authenticate one’s account, regardless of where they are. Synacor’s executive director of identity services, John Kavanagh, suggests it is a win-win for companies and consumers.

“They wanted to deliver the same user experience benefit…and we brought the trust along with it with device registration,” Kavanagh said. “The end-user experience of home-based authentication really set a high bar. They wanted to take that high bar and extend it elsewhere.”

But many subscribers, especially those with larger families, are likely to balk at the new restrictions, especially if cable operators offer to ease them in return for additional fees. The process of registering devices is also likely to be seen as cumbersome by those not technically proficient, as well as those who own a large assortment of electronic devices.

Multichannel News reports a recent study from Hub Research and CTAM that monitors the TV Everywhere market surveyed 3,491 TV subscribers who watch at least five hours of television a week and discovered 28% claimed that password sharing with friends and family members was okay and permitted by their provider, although generally it is not. Another 33% believed password sharing was allowed for family members who have since moved out of the family home and live elsewhere. No provider authorizes such viewing.

The cable industry generally does not mind password sharing for family members who are traveling or attending school and live outside of the home in a dorm, or watching on a device that belongs to a friend. They do mind if that friend keeps the user credentials and watches programming without their own subscription.

Kavanagh claims the biggest concern is “commercial-level” black market sales of user credentials to third parties who have no relationship to the account owner.

“Once we’re able to register that device securely as part of the sign-in flow, we then connect that with a complete list of devices that have been used with a given subscription,” Kavanagh said. “We not only expose that master list to the end user for their own benefit on things that might be suspicious, but on the operator side, it gives them a depth of awareness they haven’t had before. It allows them to have a fine instrument to enforce their business rules and security policies.”

Both customers and cable operators can see who is currently accessing content using their account and cancel authorization for device(s) they no longer own, lost, or are being used by those who do not have an association with the account holder at all.

The new system is being introduced on an experimental basis to some current customers, starting with Service Electric Cablevision. It is likely similar rollouts will happen with Synacor’s other clients, which include:

  • Streaming Services: Sling TV, PlayStation Vue, HBO
  • Telco TV: AT&T, Cincinnati Bell, Verizon, Windstream, CenturyLink
  • Fiber/Cable TV: WOW!, Armstrong Cable, Atlantic Broadband, Cable One, Mediacom, GCI, Hotwire Communications, Charter/Spectrum, Grande Communications

42% of Frontier’s Customers in Nevada are “Very Dissatisfied” With Their DSL Service

Phillip Dampier April 4, 2018 Broadband "Shortage", Broadband Speed, Consumer News, Frontier, Online Video, Public Policy & Gov't, Rural Broadband Comments Off on 42% of Frontier’s Customers in Nevada are “Very Dissatisfied” With Their DSL Service
Bad results for Frontier DSL in Nevada. (Source: Elko Residential Broadband Survey)

Bad results for Frontier DSL in Nevada. (Source: Elko Residential Broadband Survey)

Only six Frontier Communications customers surveyed in Elko, Nev. gave the phone company an “A” for its DSL service, while 42% flunked Frontier for what they considered unacceptable internet service.

The Elko Broadband Action Team has surveyed residential and business customers about broadband performance and found widespread dissatisfaction with Frontier Communications over slow connections and service interruptions.

“I’m pretty disappointed in them,” said Elko councilman John Patrick Rice.

Businesses and residential customers were in close agreement with each other rating Frontier’s service, with nearly 87% complaining they endure buffering delays or slowdowns, especially when watching streaming video. When browsing web pages, nearly three-quarters of surveyed customers still found service lacking.

Among the complaints (Res)-Residential (Bus)-Business:

  • Service interruptions: 74.43% (Res)/79.69% (Bus)
  • Too slow/not receiving advertised speed: 72.16% (Res)/65.75% (Bus)
  • Price: 63.64% (Res)/37.5% (Bus)
  • Customer Service: 38.07% (Res)/45.31% (Bus)

The Nevada Attorney General’s Bureau of Consumer Protection received a steady stream of complaints about Frontier’s DSL service in the state over the past year.

Answering the survey question, “would you be interested in faster download and upload speeds at prices that are somewhat comparable to what you are paying now?” 97.87 percent of residential respondents said yes.

Frontier representatives responded to the survey results at a March 27 Elko City Council meeting.

“Frontier did recognize it could improve upstream and downstream flow and educated the council and the public on some of the issues,” Elko assistant city manager Scott Wilkinson said.

Javier Mendoza, director of public relations for Frontier’s West region, explained much of the area Frontier services in Nevada is very rural, so customers are “located many miles from the core Frontier network facilities used to provide broadband service, which makes it technologically and economically challenging to provide faster internet speeds. However, Frontier is continually evaluating and working to improve its network and has and will continue to undertake various initiatives at a customer and community level to enhance its internet services.”

Mendoza said Frontier was currently testing fixed wireless internet service to serve rural areas, but had few details about the service or when it might be available.

Frontier also noted internet traffic was up 25% in the Elko area, primarily as a result of video streaming, social media, and cloud services.

But Councilmen Reece Keener complained Frontier was underinvesting in its network, meaning the company is not well-equipped to deal with increases in demand, something Mendoza denied.

“Several areas of the network providing internet service to Elko have been and continue to be upgraded, providing enhanced service reliability, and ultimately will enable new and upgraded services,” Mendoza said.

It can’t come soon enough for students of Great Basin College, where those taking online courses using Frontier DSL have problems uploading their assignments, claimed Rice, who taught online classes at the college.

“We can get the classes out to the students, but the challenge is for students to get assignments back to the college,” Rice said in a phone interview with the Elko Daily Free Press.

Frontier also claimed improved service performance so far in 2018, up from the fourth quarter of 2017. The company claimed 98.3% of service orders met performance goals, up from 94.37% and  commitments met scored at 92 percent, up from 89.98 percent. Trouble tickets declined from 1,712 to 1,244 across Nevada, the company also claimed.

FCC Looks to Press More Spectrum Into Service for 5G Wireless

Phillip Dampier April 3, 2018 AT&T, Broadband "Shortage", Broadband Speed, Competition, Consumer News, Public Policy & Gov't, Rural Broadband, Verizon, Wireless Broadband Comments Off on FCC Looks to Press More Spectrum Into Service for 5G Wireless

The Federal Communications Commission is pushing hard to free up additional spectrum in some unlikely extremely high frequency ranges — some at 95 GHz or higher, for the next generation of wireless services.

Just a year ago in 2017, the FCC wrapped up its latest spectrum auction for the higher end of the UHF TV band, to be repurposed for mobile service use. But now the agency is seeking to find and reassign underused spectrum in much higher frequency bands that could be used for services like 5G wireless, machine-to-machine communications, intelligent road and vehicle networks, and other uses yet to be invented or envisioned.

FCC Commissioner Jessica Rosenworcel made it clear that smart spectrum allocation was critical for next generation wireless services.

“The point is the list is long — and we are looking at midband and millimeter wave to power the 5G future,” Rosenworcel said. “The propagation challenges are real, but so is the potential for capacity with network densification. Of course, what we need to do next is get these airwaves to market and unconditionally hold an auction this year.”

The FCC is contemplating auctions covering these frequencies in 2018:

3.5 GHz

Widely expected to draw the most interest, the Citizens Broadband Radio Service band was originally intended primarily for unlicensed users, but the wireless industry has lobbied heavily to get much of this spectrum reassigned for traditional long-term licensed use. Although very high frequency, the 3550-3700 MHz “innovation band” will have plenty of wide range of frequencies open for wireless data and mobile services. The wireless industry wants to deploy LTE service on this band, but they will likely compete with cable operators that are seeking their own stake of frequencies to launch their own wireless services.

This band will likely support last mile wireless connections at gigabit speed, fixed wireless broadband, and even in-home Wi-Fi that is significantly better than what you have now.

Because the band is so attractive, several different users are competing over who will be portioned what spectrum. The cable and phone companies want more for themselves, but other users, including consumers, want to reserve enough spectrum for unlicensed applications. The concern is deep pocketed companies may crowd out innovators and start-ups.

3.7 to 4.2 GHz

Some consumers may have accessed services on these frequencies without ever realizing it. This is the home of the “C-Band,” recognizable to any home satellite dishowner of the 1980s and 1990s. This range of frequencies is set aside for line-of-sight, very low powered satellite television — the kind that used to require a 10-12 foot wide satellite dish in the backyard to receive. FCC Chairman Ajit Pai wants to open the band up to be shared with 5G wireless broadband, which has caused considerable controversy among satellite users who fear devastating interference.

There are proposals and counter proposals from the satellite industry and wireless companies over how to manage sharing this band. Most are coalescing around the idea of sequestering 100 MHz of spectrum at the low-end of the band and using 3700-3800 MHz for high-speed wireless broadband. Some want satellite operators to clear out of this section of frequencies voluntarily, others propose compensation similar to what was given to television stations to relocate their channel positions. Google is pushing for a plan that would offer mobile 5G service in large urban areas and 25 Mbps – 1 Gbps fixed wireless broadband in rural and residential areas.

But satellite companies and many satellite users are fearful of the impact of interference. Because satellite signals use very low power transponders on the satellite, ground based wireless broadband interference could wipe out satellite reception.

Tom Taggart, who owns several radio stations in West Virginia, says sharing spectrum was tried before and did not work well.

“This band, years ago, was shared with AT&T and other telcos for point-to-point long-distance links. Fixed, licensed paths that could be plotted and protected against for satellite installations,” Taggart told Radio World. “Our studios are 1,500 feet from an old MCI tower, at one time we had a metal screen behind our satellite dish to protect against ‘back-scatter’ from a path aimed away from us. Still, we had to convince MCI to shut down one channel so we could pick up a program from Premiere [a radio network distributing programming on satellite].”

Some industry plans propose registering C-Band satellite dishes, at a cost of $600-$1,600 per site, which would allegedly protect them from interference by requiring wireless broadband services to steer clear of the area.

“But I am not even sure what kind of broadband services are proposed,” Taggart said. “One might assume these would be omnidirectional sites, like a typical cell site. Even with some clever computer-engineered directional patterns, reflections off hillsides, billboards, buildings would be enough to overwhelm the tiny satellite signal. However, other articles described these services as ‘mobile.’ Even if my dish is registered, how can I resolve interference problems from a mobile device?”

The debate rages on because the frequencies involved, next to the even more popular CBRS band, are highly coveted.

4.9 GHz

After the events of 9/11 in 2001, the FCC has prioritized public safety communications, in hopes of improving the interoperability of different first responders’ portable radios. At that time, fire agencies could not easily talk to police, ambulance crews, or in some cases other fire crews arriving from different departments miles away.

Many agencies contemplating use of this band discovered equipment that supported 4.9 GHz was hard to find and extremely expensive. Most public safety agencies seeking grants or other funding to improve their communications equipment opted to transition to digital P25 networks that operate on much lower frequencies and use equipment that is now widely available and, in comparison, much cheaper. Many agencies are conservative about using new technology as well, concerned a communications failure could cost the life of a fire or police responder. As a result, of the 90,000 organizations certified for licenses in this band, only 3,174 have been granted. That represents a take rate of just 3.5%. The band, as one might expect, is effectively dead in most areas, underutilized in others.

“As the demand for wireless services continues to grow, it is imperative that the FCC takes steps to ensure underutilized spectrum bands are used efficiently,” said FCC Commissioner Mignon Clyburn. “This is as true for spectrum allocated to public safety as it is for the bands used to support commercial wireless broadband services.”

FCC Commissioner Michael O’Rielly is convinced wireless companies like AT&T and Verizon could use the frequencies more efficiently.

“It has been 16 years since the 4.9 GHz band was allocated to the public safety community, and it is still woefully underutilized,” said O’Rielly. “That is not sustainable in an environment in which every megahertz of spectrum, especially below 6 GHz, needs to be fully scrutinized and maximized in quick order. While the Commission’s original allocation was more than likely well-intentioned, it is way past time to take a fresh look at this 50 megahertz of spectrum.”

Although higher than 3.5 GHz, engineers believe there is a very credible case to be made to use the available spectrum for 5G fixed wireless services, delivering broadband at speeds up to 1 GHz from a small cell located nearby. It would have to be. At these frequencies, virtually anything blocking the line-of-sight between the antenna and the user will block the signal as well. With almost no constituency defending the 4.9 GHz turf, it is expected it will be repurposed for wireless broadband in areas where it isn’t in use for public safety communications.

24/28 GHz

Although the 28 GHz band has many licensed users already, the 24 GHz band does not, and the wireless industry is interested in grabbing vast swaths of spectrum in this band for 5G home broadband. Known as “millimeter wave spectrum,” these two bands are expected to be a big part of the 5G fixed wireless services being planned by some carriers. Verizon acquired Straight Path late in 2017, which had collected a large number of licenses for this frequency range. Today, Verizon holds almost 30% of all currently licensed millimeter wave spectrum, an untenable situation if you are AT&T, T-Mobile, or Sprint. T-Mobile has been the most aggressive seeking more spectrum to compete with Verizon in this frequency range, and has purchased almost 1,150 MHz covering Ohio for use with a 5G project the company is working on.

39 GHz

FiberTower, now owned by AT&T

This band might as well be called “the controversial band” because AT&T made moves on these frequencies even before the FCC got around to discussing an auction for this band, likely also to be used for 5G fixed wireless. FiberTower originally held hundreds of licenses for wireless spectrum for several years, but did little with them, leading to suggestions the company was either hoarding the spectrum to resell to someone else or was incapable of deploying a network that used the frequencies. The company declared bankruptcy in 2012, eventually emerging in the spring of 2014 just in time to watch the FCC uphold the decision of its Telecommunications Bureau to cancel 689 of FiberTower’s licenses for failure to use them.

In February 2018, AT&T completed its acquisition of FiberTower for $207 million. According to AllNet Insights & Analytics, AT&T acquired more than 475 of FiberTower’s 39 GHz spectrum licenses, raising eyebrows among shareholders who lost their investments in FiberTower after it declared bankruptcy. Hundreds of the spectrum licenses that came with the AT&T deal were given a value of $0.00, allowing AT&T a sweetheart deal and shareholders hoping to recover more money from the bankruptcy liquidation extremely upset. In fact, had FiberTower remained in bankruptcy, it would eventually have surrendered all of its licenses, which would then be put up for auction by the FCC and would likely command much higher value among bidders. Verizon effectively paid triple the price for what AT&T got for a song in the FiberTower acquisition. Even more remarkable, the FCC approved the acquisition by AT&T despite the obvious fire sale price, and has ignored the consequences of what could come from an AT&T/Verizon duopoly across large swaths of 5G frequencies.

Eshoo

That brought a rebuke from Rep. Anna Eshoo (D-Calif.) who accused both Verizon and AT&T of flipping public property for private gain.

“The FCC’s policies unambiguously required Straight Path and FiberTower to forfeit their unbuilt spectrum licenses,” Eshoo wrote. “But rather than auction the reclaimed spectrum and promote timely deployment, the FCC’s Wireless Telecommunications Bureau reached ‘resolutions’ with Straight Path and FiberTower than allowed them to profit handsomely from their wrongdoing. Following the ‘resolution,’ Straight Path sold its assets to Verizon for nearly $3.1 billion, and FiberTower is estimated to have sold its assets to AT&T for roughly $2 billion.”

In reality, AT&T acquired FiberTower for $207 million — a fraction of the amount of the estimated value of the spectrum Eshoo used in her estimate.

“The Bureau’s decisions also further concentrated critical input resources in the hands of the two dominant wireless incumbents,” Eshoo continued. “The purchasers of the public assets that Straight Path and FiberTower once held, Verizon and AT&T, already control a disproportionate amount of other critical spectrum available for immediate deployment. Up until recently, the industry had an imbalance in favor of these companies in low-band spectrum that lasted for decades. The FCC now risks going down the same wrong path with high-band spectrum should the Commission continue down this course. Allowing Straight Path and FiberTower to ‘flip’ public assets for private gain does nothing for taxpayers, but does much to further entrench the dominant incumbents’ longstanding spectrum advantage over their rivals.”

95+ GHz

The FCC has not regulated frequencies above 95 GHz, but as technology advances, there is growing interest in utilizing spectrum that many believed would be essentially unusable for communications services. Right now, most frequencies in this range are used by environmental satellites and radio astronomy. At these frequencies, signals would be absorbed by the skin and attenuated significantly by things like high humidity’s haze or fog. Still, there are proposals under consideration to open up a small portion of spectrum for unlicensed home users for things like indoor wireless routers.

The key policy priority here will be to protect existing users from any hint of interference. But with vast amounts of unused frequencies in this range, it shouldn’t be difficult to keep competing users apart.

Funding Cutbacks and Politics Trigger Closure of Multiple Public TV Stations

Phillip Dampier April 2, 2018 Competition, Consumer News, Online Video, Public Policy & Gov't Comments Off on Funding Cutbacks and Politics Trigger Closure of Multiple Public TV Stations

PBS TV stations in smaller communities and secondary PBS affiliates and public stations in large ones are ending their free, over-the-air television broadcasts after decades of service because of politics, budget cuts and repacking the TV dial to give up more spectrum for wireless providers.

The most significant trigger for the impending closedown of several stations, especially those run from universities, is the FCC’s spectrum auction and reallocation plan, repacking UHF stations into a much smaller number of available channels, requiring stations to buy new transmitting equipment many cannot afford.

The original plan to repack television stations reassured affected broadcasters that the auction proceeds from the wireless industry auctions would cover the costs of the necessary new equipment.

KNCT’s coverage partly overlaps other nearby public stations.

Then Central Texas College, which owns and operates PBS affiliate KNCT in Belton, Tex., learned Republicans in Congress might appropriate only enough funding to cover 60% of the transition costs. The trustees that oversee KNCT, which serves central Texas, realized they would have to find roughly half of the $4.5 million needed to change their channel from 46 to 17 as part of the “station repack” and hope Congress would change its mind and reimburse the station.

That was money the trustees ultimately decided could not be found, especially as annual deficits at the station now average $500,000 — costs covered by the college.

KNCT general manager Max Rudolph, who has been in charge of KNCT for most of its 38 year history, said the station will now have to leave the airwaves.

“The board had to make a tough decision, but repacking was only the tip of the iceberg,” Rudolph said. “It’s economics — dollars and cents.”

KNCT operates with a staff of 15 — including five part-time employees, that take care of both the PBS TV station and KNCT-FM, which will continue on the air. The annual budget for the TV station was about $1 million, half spent on PBS membership and programming. Donors also provided around $160,000 a year.

KNCT-TV serves the Belton/Killeen/Temple/Waco, Tex. market, although KNCT’s signal struggles to reach into the northeastern part of its service area near Waco, where public TV station KAMU-TV in more distant College Station strangely provides a better signal.

The station hopes to continue operations through online streaming and on-demand shows kept on its website, but both require a subscription to internet service. For parts of central Texas, it represents the end of free PBS over-the-air programming.

Last year, Central Michigan University decided to accept a $14 million offer for satellite PBS station WCMZ-TV in Flint to vacate its current UHF channel and close down for good April 23, 2018. WCMZ-TV’s signal reaches as far away as Port Huron, Detroit and Lansing. But its intended market was Flint, which lacked local PBS service when the station signed on more than 30 years ago. Today, Central Michigan University still operates its primary station WCMU in Mount Pleasant, along with WCMV, which serves Cadillac and Traverse City, WCML, serving Alpena, Petoskey, Cheboygan and the Straits of Mackinac, and WCMW, which broadcasts to the Lake Michigan communities of Manistee, Ludington and Pentwater.

CMU officials are pulling the plug on WCMZ because, they claim, 99 percent of viewers live in areas that are now served by other public broadcasting stations. While cord cutters may miss WCMZ, cable and other pay television customers likely won’t because the service is expected to continue uninterrupted on cable and possibly satellite.

KMTP, San Francisco’s youngest multicultural public television station, is looking for a new home after selling its spectrum for $87.8 million in last year’s FCC auction. KMTP is licensed to Minority Television Project, Inc., a not-for-profit corporation, and serves the San Francisco Bay Area with non-commercial public television. KMTP broadcasts international programming in multiple languages including English and is not affiliated with PBS.

Its best chance to survive is dependent on an acquisition or arrangement with Poquito Mas Communications LLC, the licensee of low-power KCNZ in San Francisco, which is best known for carrying Creation TV, a Chinese language religious network. KMTP can either occupy several of KCNZ’s subchannels, or potentially buy the station outright. As a low power outlet, KMTP can hope to keep carriage on cable television, giving it perfect reception in areas where KCNZ’s low-power UHF transmitter cannot reach. But that means cord-cutters may have no access to the channel unless they live near the transmitter.

WUSF-TV, on the air in Tampa for 51 years, signed off late last year after the University of South Florida decided to liquidate the station for $18.8 million in auction proceeds from the FCC’s spectrum auction. The area’s larger PBS station, WEDU, has absorbed most of the programming that used to appear on WUSF, which now appears as a virtual subchannel on WEDU — unofficially called WEDQ.

Today, WEDU carries six different signals on its over the air digital channel: WEDU/PBS HD, PBS World, PBS Kids, WEDU+, Florida Channel, and Create TV. Many of these services are also available on cable television. But the original competing voice from WUSF is now gone.

WYCC in Chicago was the city’s second PBS affiliate, behind the larger and better known WTTW. Licensed by City Colleges of Chicago, the trustees decided to liquidate WYCC last year for cash as part of the FCC’s spectrum auction.

WYCC began its operations in 1983 with a message from President Ronald Reagan, congratulating the station for producing adult learning programming lacking on commercial television. WYCC first ended its PBS affiliation in 2017 and had one sole program provider, MHz Networks’ WorldView, when it ceased broadcasting on Nov. 27, 2017.

WTTW has sought to claim WYCC’s remaining assets and intends to place WorldView on one of its subchannels in the future. It already grabbed two Australian shows WYCC used to air:  “Miss Fisher’s Murder Mysteries” and “The Doctor Blake Mysteries.” All that will remain of WYCC are its “call letters,” which could possibly reappear when WTTW launches WorldView.

Alabama Passes New Broadband Accessibility Act, $20 Million in Tax Credits for Rural Expansion

Phillip Dampier April 2, 2018 Broadband Speed, Consumer News, Public Policy & Gov't, Rural Broadband Comments Off on Alabama Passes New Broadband Accessibility Act, $20 Million in Tax Credits for Rural Expansion

Gov. Ivey signs SB149.

Alabama Governor Kay Ivey last week signed into law SB149, the Alabama Broadband Accessibility Act, authorizing the creation of a broadband accessibility grant program to be administered by the Alabama Department of Economic and Community Affairs. The bill, sponsored by Senator Clay Scofield (R-District 9) and Representative Donnie Chesteen (R-District 87), also creates the Alabama Broadband Accessibility Fund.

According to a press release from the governor’s office, there are more than 842,000 people in Alabama without access to a wired connection capable of 25 Mbps download speeds. Over 1 million people in Alabama have access to only one wired provider and another 276,000 people don’t have any wired internet providers available where they live.

“The internet is vital to economic development, health, education, and to be honest, all areas of our modern life. This common sense legislation will help us attract new broadband to areas that need it most, especially in rural Alabama,” Governor Ivey said. “I congratulate Senator Scofield and Representative Chesteen for a job well done in seeing this bill through the legislature. It is just another step forward as we improve access to high-speed internet sooner rather than later.”

Sen. Scofield

Media reports claimed the new bill would help “thousands” of Alabama’s unconnected to get access to broadband service for the first time. A closer look at the legislation shows an effort to encourage private internet providers in the state to expand their networks in areas they currently consider unprofitable to serve.

At the heart of the new law is up to $20 million in state tax credits for providers willing to expand broadband:

  1. A state income tax credit equal to 10% of the new investment a provider spends to build or upgrade broadband service in a qualified unserved area.
  2. A 10-year exemption from sales tax for any qualified broadband network facilities that are built with new investment, starting the date those upgrades go live.
  3. A sales tax exemption applicable to the purchase of equipment needed for the upgrade.

Rep. Chesteen

There are annual caps on the credits, limiting the amount Alabama is willing to spend on the program:

  1. $750,000 limit per provider if the upgrade provides up to 10/1 Mbps service;
  2. $1,400,000 limit per provider if the upgrade delivers up to 25/3 Mbps service.
  3. $20 million annual cap on program – $18 million designated for rural projects, $2 million for areas that do not receive at least 10/1 Mbps service.

In contrast, New York State’s rural broadband expansion effort paid $209.7 million in the third round of its funding program alone to extend service to an additional 122,285 rural homes, businesses and community institutions. Fairpoint Communications (today doing business as Consolidated Communications) received $3.2 million — more than twice the maximum amount Alabama will pay any one provider — to extend service to just 407 homes in the Capital and mid-Hudson region of the state.

Alabama is also counting on the Trump Administration’s infrastructure improvement spending program that will enable applicants to finance a project by combining loans and grants to provide broadband to eligible rural and tribal areas. But almost all that money will be spent on private providers, and will cover only a small portion of their costs. For a broadband expansion program to be successful, providers will have to determine if the amount of tax credits and exemptions available will allow such projects to pass the critical Return On Investment (ROI) test companies use to decide where to offer service.

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