U.S. broadband needs a facelift, becoming faster, fatter and going farther if the chairman of the Federal Communication Commission has his way. In a speech Tuesday, Julius Genachowski did what I’m beginning to think of as the “Julius shuffle”, where he takes two steps forward calling for innovation, competition and better broadband and then fails to deliver with policies that might enrage the major wireline and wireless ISPs. But the fundamental question to ask after his speech and ahead of the close of a comment period on how the FCC measures broadband in the U.S. is: what will the new broadband math look like?
Genachowski’s prepared remarks on Tuesday focused on how competitive the U.S. isn’t when it comes to global broadband rankings, unless we’re talking about mobile, which the U.S. is rocking at because we have the most subscribers on LTE networks. The speech covered the basics of this administration’s efforts in broadband — highlighting the importance of spectrum, praising network neutrality rules that the administration implemented in 2010 and noting that investment in networks has not fallen because of them and paying lip service to the need for the FCC to ensure that broadband markets remain competitive through “light-touch” regulation.
Where it got interesting was when Genachowski appeared to admit something we said two and half years ago — that his plan to cover 100 million homes with speeds of 100 Mbps or more by 2020 was a pretty low bar. Now he is calling for faster speeds because when compared with the rest of the world 100 Mbps is fairly middle of the road.
He then called for faster broadband and lauded the creation of faster gigabit networks being built in Kansas City by Google and the creation of an all fiber-to-the-home network in Chattanooga, Tenn. But because he’s still doing the “Julius shuffle” he stopped short of calling on cable companies and telcos to deploy gigabit networks. He also called for higher-capacity pipes so everyone in a multi-person home could download video or partake of high speed internet services, but didn’t mention issues like data caps which could stifle such household use of HD video. Finally he called for ubiquitous broadband that would incorporate mobile and wireline access.
His speech, combined with questions the FCC sent out in August relating to how it measures broadband have me wondering if we’ll soon see a more nuanced series of metrics for measuring broadband. Right now speed is pretty much the sole arbiter of broadband — if you offer 4 Mbps down and 1 Mbps up you provide broadband.
But under the new broadband math, it appears that the FCC is saying that speed isn’t enough and that maybe that speed isn’t even all that impressive when considering the applications people want to run over these networks. Perhaps the FCC is ready to think about whether a 30 Mbps service that comes with a 100 GB a month cap should count as broadband. It’s certainly asking if such a service should rank equally with a 30 Mbps uncapped service in its notice of inquiry from August.
Already the comments from consumers and the industry in response to the FCC’s questions has elicited the usual arguments with ISPs saying that the FCC should stop saying the U.S. isn’t deploying broadband in a reasonable and timely fashion and pointing out that places like New York have 300 Mbps service from cable and fiber to the home from Verizon, while ignoring that there are still plenty of areas where a consumer can only choose between 3 or 6 Mbps DSL and a capped cable subscription. Satellite providers are understandably leery of classifying broadband at speeds that might be higher than their services could deliver, while consumers spent a lot of timing pointing out that caps are a huge problem.
If the FCC does take a look at raising or looking at different broadband metrics, I wonder if price might also factor into play. In one line of his speech Genachowski pointed out that americans tend to subscribe to lower speed tiers than their counterparts in Japan and Korea and wondered if higher prices for broadband might be to blame. For a regulator so adept at doing the “Julius shuffle”, such a comment seemed pretty aggressive, although short of more competition it’s unclear how pricing could possible change.