Policy

Wheeler Faces ‘Defining’ Moment

NCTA to FCC: Fill Broadband Need, Don’t Up the Speed 4/13/2015 8:00 AM Eastern

WASHINGTON — This is, quite literally, a defining moment for Federal Communications Commission chairman Thomas Wheeler.

 

Even as the agency was collecting final comments on its proposal to define linear online video distributors as multichannel video programming distributors (see Rules), it was getting an earful from commenters on its decision, issued in the latest Section 706 report to Congress on the advancement of broadband, to redefine high-speed broadband as 25 Megabits per second.

 

Even Netflix, which is all for boosting speeds, told the FCC last week in response to a data request in the Comcast-TWC deal review, that customers only need 0.5-Megabit speeds to get the service, though preferably 1.5 Mbps or higher, and 15 Mbps for 4K HD.

 

As part of the Section 706 decision, the FCC had asked what it should do in response to the conclusion broadband was, again, not being deployed in a reasonable and timely fashion. Cable operators aren’t arguing that higher speeds are better. In fact, they are upping speeds almost constantly to meet customer demands, they said.

 

What they argued with, per a National Cable & Telecommunications Association filing at the FCC last week, is the FCC arbitrarily redefining broadband in a way that they say won’t advance faster, cheaper service. The NCTA put the blame back on the FCC itself, saying that the deployment gaps the FCC points fingers at are largely due to the agency’s own failures, particularly its failure to expand the lifeline portion of the Universal Service Fund support to broadband.

 

The NCTA suggested setting a speed standard to accommodate 4K Ultra HD video would be putting the super-detailed video viewing experience cart before the lifeline basic-service horse. “While the commission has spent its time worrying about whether broadband customers are able to stream nascent 4K programming, it has virtually ignored those who have no broadband whatsoever,” the cable trade group said.

 

What would cable operators have the FCC do, since it is asking? The American Cable Association, which represents smaller independent operators, said the best way to promote broadband is to make it more affordable by reining in programming costs (see sidebar).

 

For its part, the NCTA said the FCC should (1) revoke the $10 billion in high-cost Universal Service Fund support it is offering incumbent phone companies and offer it to cable operators too, or any other qualified ISPs; (2) get more money to unserved remote areas, as it signaled it would do in 2011; (3) immediately create a broadband lifeline program; and (4) figure out where the $28 billion in federal funding has gone since the FCC identified the goal of extending broadband to unserved areas back in 2010.

 

Then there is that other big definitional change: The redefinition of Internet-service providers as telecommunications companies.

 

“Compounding the situation, the commission’s recent adoption of Title II regulation for previously unregulated services will affirmatively harm deployment and adoption,” the NCTA said.

 

Cable operators are hoping a federal court, most likely the U.S. Court of Appeals for the D.C. Circuit, will provide its own new definition of the Title II reclassification: illegal.

 

ACA to FCC: Get With the Programming

 

WASHINGTON — The American Cable Association is using the Federal Communications Commission’s comment cycle on its Section 706 report to push for agency action on programming costs, a drum it has been beating here at nearly every turn of the regulatory wheel.

 

The ACA said the key barrier to broadband deployment is the high cost of programming and that, without some relief, the video portion of the triple play could become unsustainable for smaller operators.

 

The organization made that point to the FCC in initial comments on the Section 706 deployment report and reiterated it this week in reply comments.

 

In the Section 706 report to Congress, the FCC once again concluded that advanced telecommunications was not being deployed to all Americans in a reasonable and timely manner and asked for input on steps it could take ASAP to address that shortfall.

 

The ACA cited a research analysis that concluded, “If current trends continue, traditional MVPD margins will be reduced substantially each year, and multichannel video service, which has been the foundational service for triple-play providers, may become a losing proposition for small to medium-sized providers within the next five years — by 2020 — or even sooner should conditions deteriorate more rapidly than anticipated.”

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