Municipal broadband: challenges and perspectives.

• Author: Dingwall, Craig

1. INTRODUCTION AND SUMMARY II. BROADBAND DEMAND III. POSSIBLE JUSTIFICATIONS FOR MUNICIPAL BROADBAND IV. SPEED, FEATURE, AND PRICE CONSIDERATIONS V. MUNICIPAL BROADBAND STATUS A. Municipal Broadband Deployment B. State and Federal Legislation C. Nixon v. Missouri Municipal League VI. LEVEL PLAYING FIELD AND TECHNICAL ISSUES VII. MUNICIPAL BROADBAND REGULATORY REQUIREMENTS VIII. TELECOM ACT REWRITE? IX. CONCLUSION I. INTRODUCTION AND SUMMARY

   Over 50 million Americans have broadband, (1) which trails "only CD players as the fastest consumer technology that has reached mass-market popularity." (2) Over 19 million American broadband subscribers access the Internet over Digital Subscriber Line ("DSL"), and over 25 million have cable modern access. (3) Fixed and mobile wireless, satellite Internet, and Fiber to the Home ("FTTH") make up the difference, with over 4 million subscribers across those technologies. (4) Yet the United States ranks twelfth among all Organisation for Economic Co-Operation and Development ("OECD") countries in broadband penetration per 100 inhabitants and sixteenth worldwide in broadband service penetration. (6) Although broadband penetration rates are growing substantially in the United States, broadband penetration rates are below those in Denmark, Korea, and other countries. (7)

   President Bush "has called for 'universal, affordable access for broadband technology by the year 2007,'" and broadband deployment is FCC Chairman Kevin Martin's "highest priority." (8) Congress directed the FCC and the states to encourage the deployment of advanced telecommunications capability, including broadband, on a reasonable and timely basis. (9) Clearly we need policies that encourage responsible broadband deployment in the United States.

   Faced with the lag in broadband penetration in the United States relative to many other countries, it is not surprising that hundreds of government-sponsored broadband projects have been deployed or are under development in this country. Cities across the country are offering low-priced broadband access because it is not available or it is too costly in their area. Municipal broadband can, however, come at a high cost to the municipalities' ratepayers, create a glut of facilities if supply exceeds demand, and present difficult challenges for the industry and regulators. This article reviews the status and challenges of municipal broadband and provides recommendations for responsible broadband deployment.

2. BROADBAND DEMAND

   Many municipalities, telecommunications companies, and cable companies are vying to offer the elusive quadruple play of telephone, video, Internet, and wireless services. Broadband is a critical component of this package, as our society evolves from an analog to a digital world where bits of data are transferred over various applications to provide video, voice, and data services.

   High-speed Internet access, or simply broadband, allows users to reach the Internet at higher speeds than they could with traditional modems. Broadband works by using data processing capabilities that compress voice, video, and data information into bits that become words, pictures]charts, graphs, or other images on computer, wireless phones, or screens. (10) High-speed Internet access advantages include "always-on" access to the Internet, information downloads at significantly higher speeds than traditional modems, online access without tying up telephone lines, videoconferencing, employee telecommuting, and access to entertainment resources. (11)

   Several high-speed transmission technologies are available, including DSL, cable modem, wireless access, satellite access, FTTH, and power line broadband. DSL is a wireline transmission technology that brings data and information faster over copper telephone lines already installed in homes and businesses. (12) A DSL modem accesses the local telephone company's central office where a DSL Access Multiplexer ("DSLAM") transmits the signal from the copper telephone line onto a network backbone, and eventually to the Internet with an "always-on" dedicated Internet connection. (13) There are several DSL flavors, including Symmetrical Digital Subscriber Line ("SDSL"), (14) Asymmetrical Digital Subscriber Line ("ADSL"), (15) ISDN Digital Subscriber Line ("IDSL"), (16) High-data-rate Digital Subscriber Line ("HDSL"), (17) and Very high-data-rate Digital Subscriber Line ("VDSL"). (18) The number of DSL subscribers worldwide will grow twenty-two percent annually to 221 million by 2009 from the current 97 million according to a Research & Markets study. (19)

   A cable modem enables cable operators to provide high-speed Internet access using the same coaxial cables used to deliver cable TV. (20) Like DSL, cable modems offer high-speed Internet access with always-on capability and speed. (21) Cable modem speeds vary by type of cable modem, cable network, and traffic load but are generally faster than dial-up Internet access. (22)

   Although cable modems use shared bandwidth on the same cable system with asymmetric speeds that vary depending on the number of people on the network, DSL service provides a dedicated connection whose performance depends on the distance between the end-user and the phone company central office. (23)

   Wireless access providers connect homes and businesses to the Internet using wireless or radio connection technology through mobile or fixed wireless technologies. (24) Mobile wireless Internet access transmits information basically the same way wireless phone calls are transmitted. (25) Radio waves travel from the wireless device to a nearby base station, which sends the information through the telephone network and Internet to its destination. (26) With fixed wireless technology, a computer or network employs a radio link from the customer's location to the service provider, usually through a direct line of sight between rooftop antennas. (27) "Fixed wireless access customers can be located between 2 and 35 miles from the wireless provider's network between the two locations," and have "access at speeds ranging from one up to 155 megabits per second (Mbps)." (28)

   Wi-Fi, or wireless fidelity, allows users to connect to the Internet using short-range signals, and it is available at thousands of hotspots around the country such as restaurants, parks, airports, and other public places. A directory of Wi-Fi hotspots in the United States and worldwide is available at http://www.wififreespot.com and http://wi-fi.com/hotspot-hotspot-directory-browse-by-country.htm.

   WiMAX is an acronym that stands for Worldwide Interoperability for Microwave Access and is a standards-based wireless technology that provides high-throughput broadband connections over long distances. (29) WiMAX, sometimes referred to as "Wi-Fi on steroids," can be used for a number of applications, including broadband connections, hotspots, cellular backhaul, and high-speed business enterprise connectivity. (30) WiMAX is similar to Wi-Fi in concept, but it permits usage over much greater distances. WiMAX based on IEEE 802.16 standards provides (31) up to 50 km (31 miles) of linear service area range with practical maximum data rates between 500 kbps and 2 Mbps, depending upon conditions. (32) According to Intel, WiMAX provides the best and the most cost-effective broadband solution to expand service to underserved markets because the cost of deploying and providing traditional broadband services is prohibitively expensive. (33) The number of mobile WiMAX subscribers is projected to increase from 1.7 million in 2007 to 21.3 million by 2012. (34)

   Although WiMAX threatens to overtake Wi-Fi as a stronger technology, in the long term WiMAX will likely complement Wi-Fi by providing more ubiquitous coverage, greater scalability, carrier-class functionality, and better support for mixed applications needs that require high security and quality of service. (35)

   Wireless carriers are providing high-speed broadband access on mobile phones using "third generation" or 3G technology that gives mobile phone users "the ability to access the Internet via their phone at speeds up to 2 Mbps" for multi-media types of services. (36) Most national wireless carriers provide data services on their networks, and many have upgraded their networks to provide mobile Internet and broadband access at speeds comparable to or greater than landline dial-up Internet access. (37) Verizon Wireless Broadband Access, Sprint Mobile Broadband, and Cingular BroadBand Connect offer a broadband-like experience with download speeds consistently topping 500 kbps. (38) Sprint's Power Vision 3G network, based on Qualcomm's Evolution Data Optimized ("EVDO") technology is available to about 150 million people, and its EVDO Revision A will deliver faster download speeds for multimedia content up to ten times faster than the first generation EVDO. (39) Sprint is expected to continue to use its EVDO wireless broadband technology as it rolls out WiMAX alongside it to build a $2.5 billion 4G wireless Internet network capable of four Mbps download speed. (40) Sprint Nextel's Chairman claims that Sprint Nextel is not a telecom carrier, but a data services company focused on content and entertainment distribution. (41) In 2006, Sprint Nextel estimated that it would spend $6.3 billion that year to upgrade its network and deploy so-called 4G services using spectrum that it already owns. (42)

   A key difference between 3G, 4G, and Wi-Fi services is the manner in which spectrum is obtained for these services. 3G and 4G service providers pay for FCC licenses to use spectrum for these services, while Wi-Fi generally uses allocated spectrum without an FCC license. Many cities, college campuses, hospitals, malls, warehouses, stadiums, K-12 schools, amusement parks, and office buildings have built networks using unlicensed spectrum and small-area devices that collectively cover large areas. (43) Lack of coordination on...