Broadband ?

Bob Loubebobloube@earthlink.net

NASUCA 2011 Thanksgiving

Loube NASUCA 2011 1

Where has all the money gone?

• Net Investment 1996 2007• ATT $58.8b $25.0b• Verizon $46.7b $23.7b• Qwest $14.8b $8.6b

Loube NASUCA 2011 2

When will they ever learn?

• We will build broadband if:• You give us the Yellow Pages Profits – Opportunity

New Jersey• Accelerate copper depreciation – BellSouth Florida• Allow the merger to go through – Project Pronto –SBC

buys Ameritech• Eliminate UNEs for fiber and advanced networks – TRO • Set terminating rates at approximately zero – the NEW

ORDER

Loube NASUCA 2011 3

The ARC

• Is it a SLC? Is it a PICC? Is it SLC SLC?• Will it be part of the Lifeline Program?• If so, how does it fit into the $4.5 billion

budget?• If not, what happens to low-income

consumers?

Loube NASUCA 2011 4

Distributing the Price Cap Carrier Money

• Year One: based on a regression line that no one has reviewed

• Year Two: based on a model that no has seen

Loube NASUCA 2011 5

The quality of service standard

• ATT’s U-verse can provide 6mbps downstream and 1.5 mbps upstream

• Verizon’s FiOS can be provide service at very high speeds – I have 25mpbs in both direction

• DSL can provide 6mbps downstream and 768 kbps upstream

• Rumor has it that the order will require 4mbps downstream and 1 mbps upstream

Loube NASUCA 2011 6

The quality of service standard and the model

• The model will build fiber to the home.• What happens if model investment is $1000

per line and investment to meet the required service quality is $50 per line – a new mini-DSLM

• The difference is profit to the carrier• The difference limits the total number of

customers that can be supported given a budget constraint.

Loube NASUCA 2011 7

Wireless v. Wireline

• Should we support two separate networks?• Should we push for an integrated network? • -fiber to the premise• -micro cells that minimize the need for

spectrum• Should state funds provide support to pilot

projects that promote an integrated network?

Loube NASUCA 2011 8

What to do about the Intercarrier Compensation Regime?

• See you court?• Enlarge all local calling areas to be equal to the

wireless MTA areas in each state• Set transit and tandem rates to zero if one of the

parties to the call is a customer of the carrier that owns the tandem

• Set transit and tandem rates to $0.0007 per minute if the call is between customers of carriers that do not own the tandem

• Investigate wholesale long distance service

Loube NASUCA 2011 9

Wireless MTA MAP

Loube NASUCA 2011 10

Moving to an IP network• Wyoming• Century Link: 0 of 41 offices have IP switches• Rural Carriers: 12 of 53 offices have IP switches• When the FCC encouraged the move to 1-plus

dialing it allowed carriers to increase access charges to recover unamortized balances in the old technology

• Suggestion: retain LSS if the carrier purchases an IP switch

•

Loube NASUCA 2011 11

Other ways to encourage broadband build-out

• Finance municipal ownership of fiber infrastructure

• Reduce the SLC by 50 cents per year for each year a reasonable standard is not met

• Reduce the local rate by 50 cents per year for each year a reasonable standard is not met

Loube NASUCA 2011 12