Tuesday, April 28, 2015

Impact of 25-Mbps "Broadband" Definition

Conspiracy thinkers might see a pattern in recent decisions by the Federal Communications Commission to manipulate statistics on U.S. Internet adoption, even if each single decision has a logic of its own.

Beyond some greater inability to track progress, and some obvious marketing and strategic issues for entire classes of providers, it might be difficult to determine the impact--beyond universal service funding implications.

That might be considered odd, since the presumed reason for changing the definition was to spur faster investment in higher-speed networks.

Consider the decision to define “broadband” as a minimum of 25 Mbps downstream, in January 2015. Since access speeds are increasing, seemingly at a faster pace, it makes sense to periodically review definitions, at least for the purpose of determining performance levels relevant for government universal service purposes.

Oddly, the announcement about the speed redefinition began with the statement that “broadband deployment in the United States--especially in rural areas--is failing to keep pace.” The irony is that the new definitions make the “problem” bigger.

“The 4 Mbps/1 Mbps standard set in 2010 is dated and inadequate for evaluating whether advanced broadband is being deployed to all Americans in a timely way,” the FCC said.

“Using this updated service benchmark, the 2015 report finds that 55 million Americans--17 percent of the population--lack access to advanced broadband,” the FCC said.

Cynics might point out that redefining an issue to increase the number of incidents will logically create a bigger defined problem. Those who argue a higher definition will cause faster investment might argue the new definitions almost immediately will mean recipients of universal service funds will have to build at a minimum 25 Mbps, not 4 Mbps, to receive funds.

The impact on the broader market is unclear, in terms of investment incentives. Many commercial providers, especially those in the fixed networks segment, having long passed the 4 Mbps standard, arguably will not be much affected, however, as the market level of competition comes from the Google Fiber gigabit challenge, not the “minimum” 25 Mbps definition.

So changing the definition likely has little impact on many major commercial providers, in terms of investment incentives. 

But there are some odd implications, with high sector impact. Some Internet service providers have been redefined out of existence. 

That includes most satellite and fixed wireless ISPs, plus many rural telcos. Selling a 15-Mbps access service no longer qualifies as “high speed” or “broadband.”

And some of those service providers cannot increase speeds to 25 Mbps, across the board, for reasons related to lack of spectrum. If speeds higher than 25 Mbps are the future, those contestants face long term issues related to ability to compete.

Some might see other important implications, as well. Even most Long Term Evolution networks do not consistently deliver 25 Mbps, though they easily meet the 4 Mbps definitions. So, by raising the definition of “broadband” to 25 Mbps, the entire U.S. mobile industry was eliminated from contention.

Again, the result is a suddenly “bigger” problem, even if few really believe the actual state of high speed access has gotten significantly worse over the last year.

Also, the new definition meant Comcast, had it acquired Time Warner Cable, would have had at least 57 percent market share of “broadband” connections in the United States. By historical standards, that was far beyond the 30-percent share maximum that has governed antitrust thinking in the communications and video entertainment businesses.

So some might see ulterior motives. Others might see an understandable logic, less sinister but still designed to create problems, not solve them.

Students of organizational “mission creep” or development will note that organizations never declare victory and disband, when the original problem they sought to fix has been vanquished. Instead, they search for new missions.

Cynics might argue something similar was at work: definitional changes that dramatically affected the status and scope of a defined problem, with a bigger implied need for action to solve the problem.

Others might note that the fuzziness about Internet access has grown for some time, though. Classically, “broadband” was defined as any speed at or above 1.5 Mbps. That definition now is archaic, but has been replaced by a subjective notion that “broadband is what we say it is,” in essence.

That is perhaps unavoidable in a market where speed improvements, since the earliest days of dial-up access, have been increasing nearly at the rate Moore’s Law would suggest.

There arguably is no "conspiracy." But real issues are created. Comparing performance or progress over time will be tougher, since the definitions have changed. 

Many ISPs no longer can say they sell high speed access or broadband. In many cases, there are physical limits to progress, such as lack of access to additional spectrum. What policy changes can, or should, flow from that situation are unclear.


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