Telecom policy gets political

In a presidential election year, everything is up for grabs – even things no one has seemed to care about for a long time.

Telecom policy fits into that slot. Other than making vague promises about seeing broadband ubiquitously deployed by 2007, the Bush administration has shown little interest in telecom as a strategic segment of the U.S. future.

Both George W. Bush and John Kerry have delivered speeches on the importance of catching up to the world in broadband deployment – the U.S. is currently 11th – and each has a plan. Kerry would spend some government money in tax credits to encourage investment, while Bush says the free-market approach is working and is even willing to take credit for the broadband upsurge of the past two years.

What both candidates fail to realize is that there is more in play than just making cable modems, DSL or wireless technology widely available at low cost. While we are hoping to make services available today that deliver less than 1M bit/sec downstream and a fraction of that upstream, companies in Asia are offering 8M bit/sec to more than 20M bit/sec. Even in Europe, once a comfortable follower of U.S. trends, broadband access at multi-megabit speeds is considered normal.

In many cases, the broadband revolution was fueled by a government directive and government incentives, especially in Asia. South Korea, the model of broadband deployment, created requirements for the incumbent carrier and financial incentives for the competition.

By contrast, the U.S. government creates confusing rules that effectively paralyze both sides of the competitive divide. Many brush off the problem as the result of our geography. Europe and Asia are more densely populated, so loop lengths are shorter and more bandwidth can be delivered. That’s a good point, but now explain Canada, whose spaces are even more wide open but which ranks well above us in broadband deployment.

And where those who crave broadband try to cautiously navigate the dumbfounding maze of regulation, there is no guarantee that the rules won’t suddenly change. Take, for example, the many municipalities and publicly owned power companies that are building their own fiber-optic networks. In 12 states, they face prohibitions of one kind or another, many put in place to protect the incumbent. The landscape for the willing builders of alternative networks can be rocky and bleak.

This is largely true because politicians are creatures of habit, and they have a habit of listening to lobbyists. The incumbents have many more lobbyists than any of the advocacy groups backing independent broadband network construction. In some cases, the incumbents can sway public opinion – Qwest convinced Salt Lake City that it wasn’t worth joining a fiber-to-the-home consortium if it meant jeopardizing near-term DSL. The city bailed on the Utah Telecommunications Open Infrastructure Agency (UTOPIA) fiber-optic project, which is proceeding to connect 11 smaller cities.

Ultimately, falling behind in global broadband deployment will have a significant impact on our economic development, particularly in the high-technology arena. Cities such as the 11 involved in UTOPIA and Provo, Utah, which is building iProvo, its own separate fiber-optic network, see broadband access as key to their economic development and are pushing ahead, at great cost and some risk.

It makes no sense to me that our government is not only incapable of formulating policies that encourage true broadband deployment but also seems unable to get out of the way of those who would.

It will take the loud voices of those affected to begin to drown out the lobbying din of the large incumbents. There are organizations devoted to this effort – for example, the Center for Internet and Society at Stanford University has just put out an interesting treatise on the need for open-access networks. And those of us engaged in technology need to be more willing to get involved, if only out of rational self-interest.

Briere is CEO of TeleChoice, a market strategy consultancy for the telecom industry. He can be reached at telecomcatalyst@telechoice.com.