2010 Buyers Guide - Broadband Properties

Wallsten, economics director of the
adoption group for the FCC’s Omnibus
Broadband Initiative, said that to
achieve gains in productivity and in
adoption of information technology by
various business sectors, “you need a
mix of infrastructure and organizational
investments.” That is, one cannot simply
budget for fiber and hope for the best.
Hudson noted that, even in the
United States, telemedicine has not always
been sustainable because insurance
companies would not pay for remote
consultations; Medicare does reimburse
such consultations now.
“The government has tradeoffs [in
spending limited funds] and thus cannot
[afford to] make mistakes,” Wallsten
said. He added that the government
would try to increase wireless spectrum
either by allocating more or by making
secondary markets work better. (There
are opportunities for increasing the
amount of spectrum that changes hands
in third-party transactions.) Wallsten
also admitted that the Universal Service
Fund, which is intended to make
telecommunications affordable for lowincome
and rural residents, “is not sustainable
at all – it is voice-only and is
a high tax, [yet there is] a large digital
divide and the biggest gap is by income.”
This tax is counterproductive, he said.
The FCC is scheduled to issue a new
universal service funding plan in February,
but despite prodding from Noam,
Wallsten would not offer details. He said
only that separate groups are working on
the smart grid, telemedicine, broadband
adoption rates and so forth.
Matthias Kurth, president of Germany’s
Federal Network Agency
(roughly equivalent to the chairman of
the FCC in the United States), said that,
in his country, “the goal is 1 Mbps universal
service” with a “second step [to]
50 Mbps by 2014.” But, he noted, the
economic pathway to that goal, even at
this late date, is not well marked.
Said Kurth, “Norway has great
[broadband] penetration but the usage
is poor. We believe we should not kill
the private sector; there is necessity for
public investment, but only in [rural]
areas that cannot have competitive private
investment.” Kurth also notes that
in Germany, as in much of Europe, governments
strive to be neutral between
fixed and wireless options. “We cannot
predict where [fixed/mobile convergence]
is going,” he said, adding that the
economic impact of different broadband
technologies was also hard to predict,
except in broad generalities.
UK REACHES ACROSS DIVIDE
Derek Wyatt, a member of the British
Parliament and co-chair of its All Party
Communications Group, asked, “What
are we going to do about the 30 percent
[in the U.K.] who have not taken
up broadband?” Wyatt said he expected
Parliament to enact a commitment to
achieving universal 2 Mbps broadband
by 2012. He called that “rather low
and rather late,” citing a new PricewaterhouseCoopers
(PwC) study for a
government-funded nonprofit organization,
Digital Inclusion, whose mission is
reducing the digital divide in the U.K.
(The full report is online at www.raceonline2012.org.).
PwC estimated the
economic benefit of getting everyone in
the U.K. online at as much as £22 billion
(close to $40 billion).
PwC estimated that more than 10
million adults in the U.K. have never
used the Internet – and that 4 million
of that group are “socially excluded,”
that is, not working. Of these 4 million
adults, 39 percent are over 65 years old,
38 percent are able to be in the workforce
but are unemployed and 19 percent
are in families with children. PwC
NTIA Administrator Says
Government Has Broadband Role
National Telecommunications and Information Administration (NTIA) Administrator
Lawrence Strickling reported on the status of broadband planning efforts in
the United States, citing “the importance of broadband to our economic development;
the commitment of the [Obama] administration to Internet assurance [access
to the Internet]; and the role of telecommunications in creating a transparent
and connected government.”
The current economic crisis, he said, “has led to cutbacks in innovation, counteracted
by the stimulus package.”
The situation requires more than funds for deployment, he said. NTIA also seeks
to “promote building blocks of innovation [with the] largest increase in R&D, new
infrastructure, education [and an] advanced technology ecosystem that includes
providing all Americans with access to broadband.” He added that the broadband
access mapping effort had not attracted a lot of interest, although four grants (for
mapping in California, Indiana, North Carolina and Vermont) had been awarded.
Strickling noted the “last mile/middle mile tension” among grant applications
for the first round of stimulus funds. “If we focus public dollars on the middle mile,
how certain are we that last-mile providers will materialize? What about connecting
anchor institutions like schools and libraries?
“We’re trying to avoid funding bad projects. ... [We’re looking for a] comprehensive
community approach to fund public/private partnerships, anchors, commitments
to engage end-user services, [and ways to] provide lessons for other
projects down the road.
“On the adoption side we have $250 million at least. These are one-time deals,
not a subsidy program. Can we spend a dollar once and get people to adopt?” He
cited the latest Pew Research Center surveys suggesting that this strategy can work;
Pew found that half the people not adopting are unfamiliar with the technology.
Strickling admitted that the need to get money out quickly has somewhat
trumped the desire to coordinate funding to address various national needs. “We
joined the USDA [rural] and NTIA [urban, underserved] programs, and are also
working with others like health [programs] – but the programs are different,” he
said. “The health folks have not picked their communities and seem to be on a later
schedule than us.” The Department of Energy, on the other hand, handed out its
smart-grid grants before the broadband funding started.
56 | BROADBAND PROPERTIES | www.broadbandproperties.com | November/December 2009