Sunday, February 01, 2009


Benkler analyzes Broadband in Stimulus Bills

Yochai Benkler has done a close reading of the broadband portions of both House and Senate stimulus bills. Nice work.

To summarize Yochai's summary:

House: $6 Billion, split between Commerce and Agriculture Depts., requires adherence to FCC's Four Internet Principles (the Martin FCC Version).

Senate: $9 Billion, via Commerce Department's NTIA, requires less specific "interconnection and nondiscrimination."

How much broadband can a Billion buy? My own rule of thumb; a million homes passed with fiber, or 500,000 homes connected. But if these billions are treated as *stimulus* perhaps the funds could be used a lot more effectively, e.g., to spur or shame incumbents, to remove specific barriers (e.g., to municipal networks), to develop, monitor or deploy key technologies rather than entire infrastructures, etc.

Benkler continues: the House bill also explicitly defines Advanced Broadband (at least 45 Mbit/s down and 15(!) up). and sets up the NTIA to build technical capabilities to study and benchmark broadband availability and performance.

He directly addresses the suspicion of more than a few Netheads that these Billion$ are giveaways to incumbents, saying,

. . . both the House and Senate bills clearly tie the funding to core goals intended to enhance distributed innovation and open participation, uncontrolled by the incumbents, and to begin to reintroduce the idea that competition from new entrants is important and requires some version of open access and interconnection regulation is a breath of fresh air.
However, Benkler reminds us, these are yet bills not laws, the sausage machine is still a-grinding, and we DO need to monitor carefully what's in the mix.

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You're right. 15 Mb/s upstream is a shockingly small number. A household would only be able to transmit a single HD-resolution video stream. How would that work if you had three teenagers at home?

But seriously, it doesn't make sense to write a static definition of broadband into law. It should be an exponential function of time, just like the technology: N Mb/s in 2009 and doubling every K years thereafter.
Let's slow down on broadband stimulus in order to consider ownership alternatives

The current strategy of privatization with hope for competition under independent regulation has failed in many developed and developing nations. In the US, regulators have been unable to create competition and our infrastructure has suffered.

The large broadband incumbents have benefited from public subsidy, have failed to live up to commitments, and have used their power to defeat attempts to regulate competition

The US has little fiber in the access network today, but will have fiber to all urban and many rural homes and buildings in the long run. The question is not whether we are going to deploy new infrastructure; the question is “who will own it?”

We should take the time to evaluate decentralized alternatives to near-total ownership by the incumbents. Local governments, cooperatives, small ISPs, and home and building owners might own parts of our next generation infrastructure.

This evaluation can be fast and cheap. The work of the National Science Foundation in designing and creating NSFNet and connecting universities, colleges and foreign networks provides an excellent example of a small government staff calling on experts from academia and industry to design a network and a strategy for deploying it, followed by procurement via competitive bid.

We need immediate economic stimulus, but that can come from tax cuts and investment in many sectors as well as broadband.

Nobel economist Paul Krugman acknowledges the need for rapid stimulus, but also feels we should downplay the “jump start” metaphor and focus on job creation through infrastructure investment over the next four plus years, see:

We will be living with the fiber and high-speed wireless infrastructure we build today for many decades. We will also be living with its owners.

For a paper with details on the above:
Unfortunately, if the stimulus bill passes as it is now written, the owners will be just about entirely the incumbents, because the bill is heavily slanted their way. A large portion of the money is reserved for networks with speeds of 100 Mbps, which at this point means Verizon FiOS. And the USDA money cannot reach most small providers, because sole proprietorships aren't allowed to get it. Also, because the bill doesn't provide spectrum on which to roll out wireless service, wireless -- the best way to reach unserved areas -- will be needlessly hindered. Another hindrance is the requirement to adhere to the FCC's ill-advised "four principles," which prevent providers from managing their networks, preventing abuse, or containing their costs so as not to lose money (a point of special concern in rural areas, where backbone bandwidth is super-expensive).

For concrete suggestions on how to improve the bill, see my analysis at
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