Mysticism

The Federal Communications Commission issued its second look at a nationwide survey of high-speed services in the U.S.

The report, issued late last week, concluded that 2.8 million subscribers utilized high-speed Internet access and advanced telecom services at the end of last year. Of those subscribers, 1.8 million of were classified as residential or small business customers.

Federal regulators define advanced services as a mix of high-speed, switched, broadband telecom access that enables users to originate and receive high-quality voice, data, graphics, and video using any technology. The second FCC report reflects a three-fold increase in the deployment of advanced services from 1998.

The data in the report is based largely on the first systematic, nationwide "Broadband Survey" of subscription to high-speed and advanced services, initiated by the commission earlier this year.

In the first FCC report there were approximately 375,000 subscribers to advanced services as of late 1998. This total consisted of 350,000 subscribers to cable modem services and at least 25,000 subscribers to digital subscriber line access.

The penetration rate for advanced services more than tripled from 0.3 percent of U.S. households reporting at the end of 1998 to 1.0 percent at the end of 1999. Of the 1.0 million subscribers to advanced services in the FCC second look, approximately 875,000 subscribers used cable-based services and approximately 115,000 had DSL access with the remaining balance subscribed to other media.

Compared to the totals in the first report, cable companies increased their subscriber base approximately three-fold and high-speed service providers increased their DSL subscriber base approximately four-fold.

While the tally appears minuscule in comparison to basic phone and Internet services, the Commission identified several demographic groups as being potential victims of the so-called "Digital Divide," a term utilized to distinguish the broadband "have's" from the "have-not's."

The Commission concluded that the deployment of advanced telecommunications capability to all Americans is reasonable at this time, although it identified certain groups of consumers that are particularly vulnerable to not receiving advanced services in a timely manner.

At risk of missing the benefits of the broadband revolution if market forces are left to prioritize the deployment of advanced services are rural Americans, and inner city, low-income, minority and tribal area consumers.

In order to balance deployment of advanced services, the FCC said it would review its rules to ensure that competitors can access remote terminals. Rhythms NetConnections, Inc. filed a complaint with the FCC earlier this year citing that SBC Communication, Inc. $6 billion "Project Pronto" DSL buildout would prohibit collocation of DSL services because remote access terminals were not part of the Commission's line sharing order the unbundled network elements.

The Commission also said it would streamline the equipment approval process for wireless and customer premise equipment with advanced telecommunications capability. Additionally, the regulators said they would consider making more spectrums available for the deliver of wireless broadband services.

Funding for broadband deployment in the U.S. may tap into new extensions of the Commission's e-rate, which provides connectivity to schools, libraries, and the public facilities.

Finally, the Commission indicated that it would initiate a proceeding on the issue of whether to establish a national policy mandating access by rival Internet service providers to a cable company's platform.

Upon issuing the second FCC report, Chairman William Kennard painted a rosy review of U.S. broadband service deployment.

"We see some encouraging trends. Investment is strong, subscribership is increasing, and facilities deployment grows at a rapid pace as competitors race to meet demand," Kennard said.

Kennard added that he was concerned about rural and low-income areas that are much less likely to have access to advanced services.

"It is incumbent on us not to let these particularly vulnerable areas be left behind in connecting all Americans to high speed services," Kennard said. "Thus, our report identifies these areas as in need of special focus."

Commissioner Gloria Tristani said the report provided a baseline for determining broadband growth in the future, but that the zip code data utilized by the report was so general that it may have overstated the level of deployment.

"While the Commission undertook new data collection efforts in preparation for this second report on the deployment of advanced telecommunications capability, the available data do not provide a full and accurate picture of the state of deployment," Tristani said.

"The data on which the report relies suffer from several weaknesses that undermine our ability to draw well-supported conclusions and to identify with specificity at-risk communities," she added. "The Commission must rectify this when we undertake data collection efforts in the future."

Martin Machowsky, iAdvance executive director, said the FCC report was gravely flawed.

"The Commission adopted a statistical accounting of the 'availability' of high-speed services that may be based on a flawed or limited methodology," Machowsky said.

Machowsky added that the FCC should challenge telecom firms to do more and give them the tools to make ubiquitous broadband services available nationwide, not increase e-rate funding.

"The FCC failed to do what it should, outline an aggressive program to make sure all Americans have access to the broadband Internet," Machowsky said. Congress empowered the Commission to act boldly to ensure that all Americans have access to advanced telecommunications services. The Commission has not taken up the charge."