Episode 15

How Should the FCC Define Broadband?

January 13, 2021

Episode Summary

Gary Bolton, President and CEO of the Fiber Broadband Association, recently co-authored comments submitted to the FCC encouraging the agency to increase the speeds that qualify as broadband. In this interview, Bolton also shares why he thinks 2021 could be the biggest year ever for fiber investment.

Show Notes

Transcripts have been lightly edited for clarity and readability.

 

Stephen Smith: Hello. Thanks for listening in today. My guest is Gary Bolton. He is the President and CEO of the Fiber Broadband Association. And in this interview, we talk about the benchmark set by the FCC to define broadband and the implications that this has for solving the digital divide.

Stephen Smith: Gary also shares some of his thoughts on why 2021 could be the biggest year ever for fiber investment, which is very good news for those rural Americans who are still waiting on a fiber connection. So here’s my interview with the Fiber Broadband Association’s Gary Bolton.

Stephen Smith: And I’m excited to have as our guest today, Gary Bolton. Gary, welcome to the show.

Gary Bolton: Thanks, Stephen. Great to be here.

Stephen Smith: Tell us a little bit about the Fiber Broadband Association: what your membership consists of, and what the focus of the association is?

Gary Bolton: Sure, Stephen. Yeah, so the Fiber Broadband Association — well, there’s a global Fiber To The Home Council, and there are chapters around the world. Our chapter in the Americas, which I’m the CEO of, covers both North America — which we have about 250 companies — and then a little over a 100 companies in Latin America. And so we represent the full ecosystem from service providers to suppliers to deployment consultants, to every aspect from a ditch witch plowing in the fiber to the people that install the fiber, to the consultants that design the networks and engineers, to companies like Corning or like that that build fiber. And then to service providers could be anything from a rural electric co-op to a municipality, to Verizon and Google. And so, for example, our chairman is Katie Espeseth, EPB, just up the road for you, Stephen, in Chattanooga — The Electric Power Board. And as you know, that was one of the first gigabit cities in the world and now 10 gig city. So we represent that whole ecosystem. And our mission is really to help accelerate the deployment of fiber optics for broadband communications.

Stephen Smith: And you certainly seen the activity in that area increase in the last 10 years, 5 years in particular, haven’t you?

Gary Bolton: Oh, absolutely, so the organization’s been around for about 20 years. Back in the early days when right after the Internet started to get some legs. And what we’re seeing now is, you know, we saw a tremendous amount of growth. Today about 40% of America has fiber availability; there’s about a little over 50 million homes that are passed and 22.5 million homes that are connected. So we’re making some really good strides. And, as matter of fact, 2021 should be the largest fiber deployment year in history, which shouldn’t be too surprising coming off a pandemic. But, you know, I think everybody is keenly aware of how critical having robust communications is when you’re working from home and doing online schooling and trying to do telehealth, and all the things that we’ve had to accelerate over the last, I guess, 2020 since April as everybody became experts at Zoom and all kinds of collaborative tools.

Stephen Smith: Yeah, absolutely. And that really brings us to the topic of the day is as we look at all the rapid changes that we have seen. Acceleration, I guess, is really the key word there. These were trends that were certainly happening, but the pandemic really accelerated those. And last month, you submitted, the Fiber Broadband Association along with NTCA–The Rural Broadband Association, submitted a letter to the FCC. And tell us a little bit about how that came about, the intent of the letter, and how the partnership with the NTCA came about.

Gary Bolton: Sure. So, Stephen, you know, every year Congress as part of the Telecom Act, there’s Section 706. And so every year the FCC needs to report to Congress on the advanced telecommunications capabilities to all Americans being deployed in a reasonable and in a timely fashion. And where the trick is how do you define advanced telecommunications capability? And so today, the FCC defined that as 23 Mbps down stream capacity and 3 Mbps of upstream. And so if you think about, you know, where does that crazy number coming from? And about a decade ago there, the FCC, Blair Levin, created what was called National Broadband Plan. It seems like it was yesterday, but [it was] back a decade ago. The definition of broadband was 760 kilobits, about a one megabit. You know, so when we thought about broadband, we’re thinking about 1 Mbps. And we would be in really big trouble if the pandemic had happened a decade ago. What we’ve seen is that went from 1 Mpbs to you know, we started to see the FCC definition, then it went to 4 Mbps downstream and 1 Mbps upstream, and then eventually had 10/1 and then to 25/3.

Gary Bolton: And so you might wonder, you know, why is this asymmetrical? And why is it like this, 10/1 ratio between downstream and upstream? And there’s really two reasons for that. One is, you know, when the Internet, back in the mid 90s and we started going on the Internet, as you may recall, we had these little analog modems that we put on our phone line. We had our lifeline phone twisted pair, and we’d modulate over that voice span and we would get 50 kilobits or something like that. And so as we grew, we went to a new technology called DSL. And so what this was, is trying to modulate the data part of your telephone network across your phone line into using more spectrum. So if you think about your dial on your car radio, the more spectrum you have, the more channels you can have. So the technique was to get more spectrum. So the net of this is to be able to have higher downstream capacity, you had to lower your upstream. Because if you can think about, you know, if you have your string with two cans and a string between that and you were trying to shout at the same time, you’re not going to hear anything. And so what you want to do is shout loud from one end and softly from another, and that way you can go for a longer distance. Another way to think of that is, you know, if you’re going into Nashville, and it’s rush hour. And you’ve got 10 lanes to use, and you put nine lanes going into the city and one lane coming out in the morning, and then you switch them around the other way, right. That you only have so much highway and you’re trying to get as much traffic going in the rush hour direction. So all that was kind of the way it started, and that’s where this — how do we get more what’s called rate reach, higher bandwidth over longer distance over a piece of copper or coaxial, cable network or over your twisted pair voice network. Well, over time, that whole voice network has disappeared, and everything has gone to Internet protocol, voice over IP and so forth. And so now it’s a data network. And so it’s really antiquated. And so when you look at fiber, it is a medium that gives, nothing goes faster than the speed of light, and now you’re being able to deliver unconstrained bandwidth that can go at symmetric speeds. That means that you’re not being limited to 10% of your capacity in the upstream basis.

Gary Bolton: And so why is this important? As you know, since April, I guess, when we’ve all been working from home, it’s been really important, right? Because, you know, I never used Zoom before April, and I use it 50 times a day now. I mean, we’re doing Zoom conferences, you know, we’re doing telehealth sessions. UAB, just down the road from you Stephen, before April, they were doing 4 telehealth sessions a day. Now they do 1100. And so if you’re sitting there talking to your doctor on a two-way video, if you’re trying to do any medical imaging, even if you’re trying to upload your YouTube videos or whatever, the kid’s soccer game or whatever you happen to do, you know, all of a sudden you’re trying to upload files, this upstream becomes critically important. So if you look at the bandwidth, it’s been growing now at a rate of about 20-40% per year. And so when you go to the Congress and say, oh, yeah, everybody has broadband. We’re doing a great job of ramping it out, and it’s measured on 25 megabits downstream, 3 [upstream]. You know, we just don’t think that’s appropriate. You know, we are right now what we’re seeing is that for a family of four, based on a technology committee study, is that you you need today, just today as of 2020, 85 megabit downstream and 50 megabits upstream. By the end of the decade, we’re going to need 2 gigabit upstream and 2 gigabit downstream, so 2 gig symmetric. So I think that’s the message that the Fiber Broadband Association and NTCA sent to the FCC is that you need to look at a gigabit symmetric today and at minimum, 100 Mbps symmetric rather than a fairly antiquated standard.

Stephen Smith: Right. Because not only is that standard, the asymmetrical standard, antiquated, like you said, because technology doesn’t drive that anymore, but the usage patterns now are really driving the need for that symmetrical connection. I heard it put well, recently, someone said that we’ve really switched from being consumers across the Internet to producers. And I think that touches a lot on what you’re saying there about being on the Zoom calls, for instance. I mean, you’re producing at that point.

Gary Bolton: Exactly. You can think of the Internet in three waves. And so the first wave back in the 90s was kind of that, you know, on-ramp to the information superhighway. And that was just, we dial in and be able to go on. And then what we saw kind of in the 2000s was that we started to build upon that. And that’s where we started seeing social media and start to get into mobile networks and so forth. And now we’re moving into the third phase, which is where the Internet is really the fabric of our lives. Our doorbells are streaming all day long. We have everything connected. You know, it’s pretty hard to do anything without being connected to the Internet. Whether you want to be able to drive down your car and look at a Google map and see where you’re going. To, I got a new computer, and my hard drive is online; so everything is on the cloud. So if I’m accessing my data, it’s no longer sitting resident on my PC. And so we’re just in a different era. And that’s going to accelerate going forward.

Gary Bolton: You start looking at things like, we went from high-definition TVs to 4K, now we’re going to 8K TVs. So you’re starting to now stream things in 8K; that takes up an incredible amount of bandwidth. So it’s going to be more important. Just even broadband in general, you know, other things that — look at the economic development perspective. When you’re going to buy a home right now, if you’re in rural America, when someone goes to say, where am I going to live? And now that we’re moving to a “I can work from anywhere economy,” I’m not stuck in a city. You know, I don’t have to go to an office. I can be able to work from anywhere. If I want to live in Rainsville, I can be able to do that. And so the number one things that people look at is, is it a safe street? I want a community that’s going to be safe for my children. But the second thing they look at is what is the broadband connectivity? And when you go to buy your house, it’s also the second thing. The first thing you look at is the laundry. The second thing you look at is, does this is neighborhood have broadband? And that’s ahead of the great room. Looking at even the behavior in our homes, now we’re online 6.1 hours per day. And so, you know that we need to be able to work from home, the video gaming, upload files, even upload YouTubes, or like I said storage on that and so forth.

Stephen Smith: So, Gary, tie this back to the practical issue of funding, because someone may hear this conversation and think, well, what does it matter what speeds we use to define broadband? Because, you know, fiber is there, broadband is broadband. Why is it so important that the FCC has these benchmarks?

Gary Bolton: Yes, that’s kind of a really important point, Stephen. So, you know what the FCC and the government in general is saying is, okay, we’re going to try to put out funding for rural broadband. Do we spread it like peanut butter, right? So do we say that…and we saw this with the RDOF auction. And so one kind of what the previous thought pattern was, is it’s better for every rural America to get something than nothing, right? So if we keep the benchmark low, and they can get some level of connectivity and maybe that’s through some type of satellite or fixed wireless or something. You know, and that’s really not the case. You’re not any better off having bad broadband than no broadband. You know, you’re not going to be able to work from home. You’re not going to attract companies to your community. You’re not going to be able to have rural, remote health care, all those things. You know, I teach at the university here, and we basically got notified last spring on a Friday that the whole university was going online on Monday. And you  have to figure out, well, gee, I don’t have great broadband at my house. How am I going to teach my classes online? And so I think that that kind of thought process really got blown out of the water with the pandemic and people really needing to be able to be productive and efficient from home.

Gary Bolton: And so when we look at, you know, the the latest federal subsidies, as through the Rural Digital Opportunity Fund, RDOF. And so we had a $16 billion auction, which sounds great, and the FCC went and created a gigabit tier. And so basically, if you wanted to get the maximum amount of money, you would have to bid on a network that was going to deliver gigabit services, and then they would have three different other tiers that would get as much as only 10% of the budget, you know, like if you did a wireless or something like that or a very low bandwidth tier. So what happened is they went to the auction, awarded $9 billion, and 85% of the winning bidders were in the gigabit tier. And so, you know, awesome, right? Rural America is going to get gigabit services. But what we found is that the bidders (operators) that were bidding, they bid things like wireless and low earth orbit (LEO) satellite. And so you’re looking at it, and we saw a lot of private equity and companies that were just recently formed with like eight or nine employees winning large segments of the country based on these technologies.

Gary Bolton: That is going to be very difficult to be able to deliver that. And so I think what we’re looking at right now is these all the winning bidders are going to have to file their long form applications with the FCC on January 29. And so what we’re looking for is the FCC to highly scrutinize any winning application, a long form application, that isn’t using a fiber network. And because we know that fiber can deliver that quality, high quality, low latency and high performance broadband. So on fixed wireless, you know, there are times when, if you can get fiber very close to a customer, to a subscriber, and then be able to, you know, maybe there’s a lake and you have to shoot across the lake with a wireless signal, but you have to have line of sight. You have to have just the right parameters and conditions to be able to connect that rural subscriber. So that is a path to fiber, because what we’ve seen from service providers is those that are deploying fixed wireless access, they are very motivated to get fiber at home because as soon as they get fiber all the way to home, they’re their customer service center, and the phones stop ringing. They’re not having people complaining about the service. And so they know that as soon as they get fiber all the way, the phones are quiet. Giving money to Elon Musk to put more LEO satellites in orbit is literally stranding our federal rural dollars in space because it’s the path to nowhere. The only way to improve the performance of a LEO satellite is to darken the skies with more satellites. And so that’s very, very concerning that this is an unproven technology, and it certainly isn’t going to be able to provide the same… We’re trying to eliminate the rural divide, not increase it. And so, you know, the whole thing about economics saying well gee, if I could just have an antenna that covers this massive landmass or put up a satellite in the sky, and we’re all good. That’s really, really concerning to rural America.

Gary Bolton: And I think we have a great opportunity coming off the pandemic. What we’re seeing is that two-thirds of workers will not go back to the office the way they were before the pandemic. All the surveys I’ve seen show that a third of employees say I’m more productive at home and this works for me, and I want to be able to live anywhere I want. And so I’d like to continue working from home full time. Another third say, I do like going in the office. I like hanging around the water coolers on lunch with people. So if I could work from home two, three, or four days a week and come the office a few days a week, that would be the best of both worlds. And then the last third is, I really like being at the office. And so if you think of two-thirds of our workforce going to be working from home, they’re not going to be living in rural America if they don’t have robust broadband.

Stephen Smith: You’re absolutely right. I know the FCC has really stressed the fact that the decisions of granting funds needs to be technologically neutral, but you make a good point that there are some technologies that just cannot provide the bandwidth that we really need out there. And I think some of those you mentioned, the LEO satellites, some of those initial tests, those speeds were were very disappointing, I think.

Gary Bolton: Yeah, that’s a big hole. And the LEO satellites were in the 100 Mbps tier. So it’s just not a good solution for what rural America needs. So we’re definitely going to encourage the FCC to carefully scrutinize. So the good news is the process that the FCC has in place is a good one. So before you are awarded your funds, you have to go through a very strenuous long form process. Have your networks certified by an engineer, and the FCC is going to go look and make sure that performance is going to deliver what the winning bidders promised to deliver. So we are definitely going to be working with the FCC to make sure that they have the tools they need to be able to vet these network designs to make sure they’ll deliver. But the one thing that we definitely know for sure is if you have a fiber network, you are going to have the optimal performance, the fastest. Nothing is faster than the speed of light. From a maintenance perspective, it’s going to be the lowest maintenance for a service provider. From a security perspective, it’s more secure. From a durability, reliability. So every possible parameter — latency — fiber is the gold standard.

Gary Bolton: And so anything else is you might have to — you know, you can’t use a single tool in your toolbox. So there are going to be technologies. Like I said, you might be in a situation that you’re deploying, and you have to get across the lake. And you need the wireless to get across the lake until you can build out your fiber. So there are times when you have to use other technology, but those technologies need to be… So if I look at the Connect America Funds, and that’s where we started off at 4/1, 10/1 and 25/3, and those were largely DSL networks. All that investment went in to build the fiber middle mile. They put fiber out of the node. It progressed. While it didn’t deliver the fiber to the home on day one, it put in a lot of fiber to get fiber out as close to the rural communities as possible. And then so then when we’re able to as people subscribe, and they’re able to have the revenue to be able to continue that network, it put these subscribers or these operators in position. We did see a lot of those people who took that money, those companies went bankrupt, the tier twos, Frontier, Windstream, and so forth. And so now they’ve merged debt-free, bank restructuring, and now they’re doing big fiber deployment because what they saw is if you didn’t have fiber to a subscriber, you lost subscribers. And so they lost a lot of their subscribers to cable. And now that we’re going more symmetric, we’re seeing that cable now is going to be having to move over from these DOCSIS networks to fiber access because the demands on upstream.

Stephen Smith: Gary, what are you hearing from your members about the challenges that the pandemic has brought their way?

Gary Bolton: Well, it’s kind of twofold, right? On one side, no one asks “why fiber” or anymore. You know, it’s really kind of crystallized the need for fiber deployment. And so you see a lot of tailwind to that. And as a matter of fact, we believe 2021 will be the largest investment in fiber in history. And so when we look at all the Capex deployment that could really accelerate this year from service providers of all sizes. The challenge is that the pandemic has created is supply chain issues, workforce issues. So, you know, given that we’re in a big beginning of the big fiber year investment cycle, we have to have qualified fiber professionals that can be able to get that fiber out and deployed. We have to make sure that we have enough of the fiber itself and all the other technology, the electronics and so forth. And so overcoming a lot of the supply chain issues. But I know that if you go to buy anything these days, you can see that there are some challenges there. But I’d say that the silver lining of the pandemic is (1) the timing. Like I said, we wouldn’t have been able to survive the pandemic a decade ago. You know, so we’re I think we’re right on the cusp of having the network robust enough to be able to allow people to work from home, go to school from home, to be able to conduct, keep businesses afloat and the economy afloat with the current broadband infrastructure.

Gary Bolton: And (2) it also accelerated the adoption of these collaborative technologies and tools. You know, it’s very unusual for me to have a meeting that’s not Zoom or Teams or some kind of collaborative video conference today. Everybody’s very used to using collaborative and online tools. You know, everything’s going online. You can’t even get an exercise bicycle like a Peloton that’s not connected to the Internet. You know, so you see the model change. You know what you were talking about consumers and producers. So even if you’re riding your Peloton, you’re becoming a producer of data, right? And you’re riding with other people, I guess, in the network. So it’s really become, you know, pull the world together from a virtual video perspective. But, I think that there’s a…and the other part I really like is the ability to now work from anywhere and to demonstrate that we can be able to be productive in our careers and our jobs, you know, working from places where we want to live. And these beautiful rural communities that don’t have that broadband infrastructure in place, that they don’t have the fiber in place, it doesn’t allow that to happen. And so I think that it’s critically important that these rural communities don’t get relegated to inferior means of deploying broadband. They need to be able to if…they’re at 100 Mbps today, and they need to be at two gigabit in 10 years and beyond, they need to have a path to get there.

Stephen Smith: So in closing, Gary, what are your hopes for the new FCC? We’ll have a new chairman of the FCC, and we already have one new member, and we will be under the new administration, what are your hopes for that agency moving forward?

Gary Bolton: Well, yes, it’s definitely a new FCC with Chairman Pai exiting, and so will definitely have a new chairman. You know, it could be Jessica Rosenworcel, but it’s definitely going to be one of the Democrats. You know, we did just add a new member to the FCC. So unfortunately, I think one of the things that’s going to bubble up as a top item will be net neutrality again. Every administration change that seems to bubble back up, which can be a real distraction.

Gary Bolton: But I think the FCC understands how critical the pandemic has really shined a bright light on how critical broadband is for rural America. And so I think that we will see the FCC hopefully stay on track and do the right things to help. You know, put out more subsidies and programs in place to be able to address rural America. It’s not just the FCC, the USDA, RUS, you they had the ReConnect program that’s been very successful. Again, you know, Chad Rupe was the administrator, and he’ll be leaving and a new within the Biden administration they’ll put a new administrator in, and hope that all that momentum with their ReConnect program and other broadband programs.

Gary Bolton: We’re also seeing Congress with the transition committee. We’re getting a lot of inquiries on. You know, I think they’re looking at legislation that they’re going to position in a jobs bill. And what they see is that fiber delivers jobs. And so they’re asking those questions of, you know, for a million dollars investment in fiber, how many jobs does that produce? What kind of jobs? And we’ve been providing input on position profiles and in the type of jobs that that would create. And so I think while the the recent Covid legislation that happened during the Christmas holiday period was not so much an infrastructure, I think you’ll see some legislation come out that will be a focus on infrastructure. So, again, we have a beginning of a big investment cycle on fiber. While it’s great that we got $9 billion going into the first phase of RDOF, the job’s not done. We really need the states to step up to be able to deliver more subsidies, to be able to get rural broadband out. And we need to make sure that the networks are getting built are ones that are going to serve rural subscribers, not just for today or tomorrow. But our bandwidth demand is going to just continue to increase, and we need to have that robust infrastructure in place so that we can all live wherever we want in places we enjoy and be able to have the quality of life, whether it’s education, health care, employment, economic development. And that’s really driven by getting more fiber out there.

Stephen Smith: Well, said. Well, said. Gary, thank you so much for sharing your perspective with us today and coming onto the show. We enjoyed having you.

Gary Bolton: Stephen, I enjoyed it. And, you know, I hope that all your listeners, if they have any questions or anything that we can help, I can always be contacted at The Fiber Broadband Association, fiberbroadband.org. And again, thanks again for having me.

Stephen Smith: Absolutely. And thank you for listening to Rural Broadband Today, where we take a look at the people and issues shaping the rural broadband story across America. I’m your host, Stephen Smith. This program is produced by WordSouth — A Content Marketing Company. Please share this episode with your network and help us tell the rural broadband story.

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