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November 9, 2016

FCC to Rural America: Drop Dead

The FCC is Wrong. It’s your turn, Mr. Trump, to support rural America as it supported you.

When I worked at the FCC from 2012-2016, I proposed various ways to provide the same level of internet access service to rural America as is enjoyed by urban and suburban America. I am a lifelong Republican, which was well known by the Democratic leadership. The reaction I received over the years to my proposals can be summed up by two statements made to me by the most senior officials in the Wheeler FCC. I was told on more than one occasion, “Republicans like corporate welfare, so we’re going to give money to the telephone companies to keep the Republicans on the Hill happy.” And, “We’re Democrats. They [rural Americans] are not our people.”

I was born in Washington, DC and have spent most of my life inside the Beltway, so cynicism is as natural to me as cherry blossoms in the spring and the Nats collapse in October. But a new president brings different personnel and a chance for the rest of us to make the same arguments and hope for a different outcome.

To the Trump transition team and the potential FCC nominees, with respect to the most important economic issue in rural America, I offer the following:

  1. The Obama FCC got its aspirations wrong.

In 2010, the FCC produced a comprehensive report, the National Broadband Plan, which set as its first goal: 100 Mbps service for 100 million households.

In 2010, there were nearly 117 million households according to the U.S. census. The plain meaning of the National Broadband Plan was that the millions of households living in rural America were not part of the high aspirational goal. For those areas, the FCC declared that 4 Mbps would be sufficient, a figure the FCC later adjusted to 10 Mbps. 10 Mbps at a time when every Internet Service Provider brags about their 1 Gigabit residential service, and some have announced plans for 2 and 10 Gbps service. Why such a low goal? Because the telephone companies told the FCC that 4 Mbps was all that was possible.

I am fond of a phrase coined by Michael Gerson — the soft bigotry of low expectations — a phrase that fits the FCC’s views of rural America.

Instead of high goals, the FCC settled on the Washington money game. Like many in Washington, the FCC leadership often confuses spending money with getting things done, and in this case, cynically so.

As recently as this spring, the FCC continued its misguided spending spree, adding over $20 billion on top of $9 billion for telephone companies to deliver 10 Mbps service in rural America over the next decade.

  1. The Obama FCC got its facts wrong.

The FCC would have you believe that 10 Mbps is all the nation can afford for rural America. But the FCC’s numbers are based on flawed assumptions resulting in a significant misallocation of public funds.

The FCC used models to calculate the costs of a greenfield, fiber-to-the-home network, built and operated over thirty years. The models attempt to define to the penny where and how much government support is necessary.

The cost models are first-rate telephone company models. But they don’t take into account any existing infrastructure or alternative providers and, as such, vastly overstate the cost of building, operating and maintaining networks in rural America.

Across the country, companies are building gigabit fiber-to-the-home networks in rural areas with little or no government support. In Missouri by Co-Mo, in Arkansas by Ozarks and North Arkansas, in Michigan by Midwest, in Colorado by Delta Montrose, in Georgia by Habersham, in Virginia by BARC.

Electric cooperatives are demonstrating that fiber optic networks can be built in rural areas with population densities of 5-10 homes per mile. Below 5 homes per mile, public funding can be essential, but at far lower levels than the FCC’s calculations.

In short, the FCC has allocated public money in the wrong places to the wrong people for the wrong service.

  1. The Obama FCC got its constituency wrong.

In a different political era, I worked for a great man named Jack Danforth. Jack is an old school patrician politician. On the wall of his Senate office, he had hung a black and white photo of a tough, weather-beaten and grim-faced farmer, with the title underneath, “The Boss”. It was a daily reminder to us all of who we really worked for.

At the FCC, I was hired by Chairman Julius Genachowski, kept on by Chairwoman Mignon Clyburn, and eventually fired by Chairman Tom Wheeler largely for my vocal support of rural America. Through it all I never forgot who I was working for. Not the Chairman, not the bureaucracy, not Congress, and certainly not the telephone companies. I worked for the people of the United States of America — all of them — and was proud of it. I still work for the people, the members of rural cooperatives, and I’m still proud of it.

Now it’s your turn, President Trump. Make Rural America Great Again.

 

 

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About Jonathan Chambers
Jonathan has worked for over thirty years at start-up telecommunications companies and in the U.S. Government. Prior to joining Conexon, Jonathan served as Chief of the Office of Strategic Planning for the Federal Communications Commission. Jonathan was part of the senior leadership at the FCC that reformed $12 billion in annual federal spending, including the rural and high cost fund, e-rate, telecommunications relay services and the lifeline programs. For the majority of his career, Jonathan has worked with companies building broadband networks. Jonathan left the FCC to help electric cooperatives bring fiber-to-the-home (FTTH) broadband to rural areas throughout the country.

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