Cities will sue FCC to stop $2B giveaway to wireless carrier
arstechnica.com
arstechnica.com
If you're going to use government money paid to private corporations to do this then the private corporations should pay the government back out of the regulated rates. After that, the infrastructure is paid for, and so long as it's available under the same terms to others, go nuts.
If the cable internet market was more fair (limited providers, high rates in many areas) I'd have more hope.
Did you read the article?
That said it seems very wasteful that our 2-3 phone carriers are all going to be putting up new equipment, I'm not sure if there is any law/rule/agreement about them sharing but it seems stupid to have a 5G modem for T-mobile, AT&T, Verizon all on the same pole incurring the same maintenance and cost.
Even if there was just one national carrier that owned all of T-Mobile/AT&T/Verizon, they'd still need close to the current amount of RRUs + gear + backhaul, to support the same number of total users on all of the various spectrum bands being used.
There would be some maintenance/cost savings. But not a huge night-and-day difference.
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For what it's worth, Portland charges $250/month for a point of presence (from the article). I'm no cellular expert, but from my WISP days, that's the cheapest rate I've ever heard of for a such a thing, short of donations on farms and windmills and the like. Similar rent on a cell tower would cost $1,000 to $3,000+/month.
I'm totally open to the idea that cities could be overcharging for utility pole access -- that a few cities abuse the hell out of this authority and that this should be corrected. But the FCC's rule forces Portland to drop the rent from $250/month to just $22/month. At this extremely low price point, I suspect the city of Portland would actually be subsidizing the majority of these site costs for cellular providers, at the expense of their city's budget.
For comparison, it costs something like $2k to $3k just to build or replace a single pole (in cheap low-CoL suburban areas, using cheap wood non-metal poles). At $22/month, if a pole was used by Verizon alone, a city wouldn't break even on the cheapest possible initial pole costs for about 10 years (and that's assuming it never needs maintenance or repair or temporary movement ever).
If cities lose this fight, I would expect them to raise their income taxes and/or property taxes to cover the money the FCC is making them give cellular telecoms.
I don't know what a fair rent is though.
Often, occupants of a pole can delay others from using the public pole for years at a time. We see this with competing internet providers tying up pole access for new-comers in court. On top of that, existing users of the pole can layout their cables such that new-comers would have to invest in re-positioning, which then also happens on the existing users schedule. This can also tie up the pole for years at a time. Embedding cabling along the roadside has similar issues, and depending on the timing, new-comers may have to incur the cost of repaving the entire section of road they use, not just the routing area.
Yes, absolutely!
> I don't think cities should be able to stifle the industry.
Portland, OR couldn't stifle the industry if it wanted to. Besides that, city governments don't answer to the industry; they answer to their voters.
Do you find your city government to be very responsive to your desires? Maybe it actually is in small towns, but in larger cities, the government basically does whatever it wants on niche issues like this, with no real oversight.
Yes, but only because I hold them accountable with FOIA requests and constant generation of a paper/documentation trail.
There are differing views on the appropriate level of regulation for uncompetitive markets and natural monopolies. But almost nobody sane would prefer a regulated market to an actually competitive one. Deregulation of industries like trucking, air freight, and airlines, where there are several competing providers, has proven to be a massively positive thing compared to how things were in the 1930s-1960s. 5G offers that possibility here--the possibility to abandon hairy questions about how to regulate because competitive obviates the need to regulate. Opposing that is madness.
Now that fees may no longer be used to gauge the relative value of pole access to different firms, what will determine which firms are allowed to use them?
The question isn’t how many does it take for optimal competition, but how many companies does it take to beat a government-regulated industry? The answer is probably two, maybe even one. (It’s a good thing the government never regulated Microsoft.)
Pole access fees were never used to determine the relative value of access to different firms. The Communications Act requires pole access fees to be non-discriminatory. Everyone pays rates according to a schedule. Which is a good thing, because local governments have no competence to pick among providers. That’s the pre-1994 behavior that led to de facto regional monopolies today.
In the soft drink industry, no firm has to do anything but start mixing and bottling soft drinks. Which explains why there are hundreds of smaller firms, from the 7up-RC company on down. The moat that Coke and Pepsi have is maintained purely by marketing. There is no Federal Drinks Commission whose members expect lifetime sinecures from Pepsico.
You conclude with an astonishingly ahistorical explanation for current telco monopoly. Ma Bell was protected from competition by FCC for decades, and both the "divestiture" and the later "unbundling" were carefully choreographed by FCC and DoJ to arrange for just the reconsolidation we've seen since.
There's tons of bandwidth in the millimeter wave spectrum where key 5G deployments will happen: https://www.verizon.com/about/our-company/5g/what-millimeter.... And the government is working to clear more.
Proponents of regulation have this tendency to view things through a moral lens. "Wireless should be regulated because it uses public spectrum." But the question isn't whether regulation is morally justified, but whether it is economically efficient. That means the focus is not on whether some public resource is being used, but how many competitors can be sustained with those public resources. Even with LTE, there are four nationwide competitors, which is more competition than exists in many other markets. And 5G can support even more. Whether or not those competitors need to use public spectrum to provide their service, there will be enough competition to obviate the need to regulate.
> The moat that Coke and Pepsi have is maintained purely by marketing.
What you call a "moat" is in economics terms a "barrier to entry." And there's lots of different ones. E.g. anyone seeking to compete with Android and iOS have to account for the network effect caused by existing app libraries. Nothing makes the barriers to entry in 5G magically different from network effects or branding strengths or other barriers to entry that exist in other industries. The fact that a moat exists doesn't mean regulation is automatically warranted. Regulation is only warranted when the barriers are so high that there is no functioning competition. And experience shows that regulation is very hard, and markets have to get very dysfunctional before a government-regulated industry becomes preferable.
> You conclude with an astonishingly ahistorical explanation for current telco monopoly. Ma Bell was protected from competition by FCC for decades, and both the "divestiture" and the later "unbundling" were carefully choreographed by FCC and DoJ to arrange for just the reconsolidation we've seen since.
That's both irrelevant and proves my point. It's irrelevant because we're talking about wireless, which was built entirely post-deregulation. (And even in the context of wired broadband, most people get their broadband today from cable, and those networks were never regulated under the telephone regime. Instead, local governments handed out monopolies in return for grab-bag handouts, which is exactly why they should have minimal authority over deployment.)
It also proves my point, because the treatment of AT&T is a product of how folks thought about utility regulation back then. (See: Master Switch). Back then, regulators thought competition was a bad thing. They thought it was better to have a tightly regulated monopoly. So the Communications Act of 1934 provides for the FCC to micro-manage telephone companies, telling them when they can build lines, etc. This was not unique to telecom. It goes back to the Interstate Commerce Commission and how they regulated railroads (and later trucking, airlines, etc.). They didn't trust competition, so they put regulators in charge of infrastructure deployment, pricing, etc.
Starting in the 1960s and 1970s, Congress realized this was all nuts--antithetical to what we now know about competitive markets. So they deregulated vast swaths of the economy. In the 1990s, they applied the same ideas to telecom, prohibited granting regional monopolies, etc. The result was a massive boom in telecom investment.[1] This was not unique to the U.S., most of the developed world substantially copied our approach.
To the extent that the 1996 Act has been less successful than intended, the blame squarely lies with municipal governments. Most cities make it illegal to build an MVP version of an ISP. You're required to either cover a whole city or nothing. And they use franchising powers to extort concessions (5% of gross revenues as franchise fees, free fiber for government buildings, etc.). Local governments are the ones who have created an environment that makes it unpalatable for new entrants to compete.
5G offers another bite at the apple. It dramatically lowers the "natural monopoly" aspect of telecom deployment. Even with very small cells, it eliminates the "last half mile" (and the massive fan-out that happens in the last half mile). The only thing that stands in the way is municipalities, who don't understand regulatory theory, just that they can use whatever permitting authority they have to extract grab-bag concessions.
[1] If you doubt the success of the 1996 Act, consider this: U.S. broadband speeds are faster than Germany, the U.K., France, Spain, and Italy. In what other area of infrastructure does the U.S. outperform these countries? The answer is none. Our roads suck, our trains suck, our subways suck. But our broadband is faster! Compared to another highly-competitive industry--CPUs are maybe 100x faster for single-threaded code than in 1996. Your broadband is probably 1000-2000x faster. All this makes me wonder if the people who facilely declare the 1996 deregulation to be a failure are living on the same planet as me. Or, more cynically, it's such an astounding blow to their ideas about "enlightened regulators" running the economy that they have deny its success, regardless of facts.
I would love to believe this vision of 5G you offer, of enough competition to actually change the character of internet access in USA. I love to imagine that innovation supported by ever smaller and more numerous connected devices might someday be possible. I love that on the wired side I can hire e.g. Jive or one of its many competitors for my business phone system and Netflix or one of its many competitors for personal entertainment. That services are not tied to the network is a basic internet design principle. Yet even in wired I still have to pay more for a data connection alone than for a data connection plus some stupid local phone or TV connection. (The only exceptions are where a local municipality has had the vision to defend local interests.) Wireless, of course, is much worse, e.g. with MNOs overcharging average users so as to subsidize whoever is using the favored online-service-of-the-month. I know they're overcharging because if I sign up with MVNO Ting I get the same service for less than half the price. Marketing is expensive, but so is buying FCC. Also yes I took Ec 10 and several additional courses; I don't require reminding that "moat" is a euphemism for "barrier to entry".
It's telling that when speculating about new entrants, you come up with... Comcast and Google. Well yes these giant oligopolistic firms will continue to exist as such. That isn't exactly a wave of entrepreneurial investment like that we saw in the late 1990s. Investors learned from that debacle. When you pour many billions into a marketplace the regulator of which has been owned by one actor for six decades, that actor will end up with most of your investment. It will take a few decades for investors to forget that lesson. Sure, it's nice for backbone customers that long-distance data is still overbuilt even now. Somehow that doesn't help the average last-mile consumer.
How do I know? What am I talking about? In a previous stage of my career I worked for both CLECs and ILECs. I've seen the change orders dropped on the floor by the hundreds, for no reason that VZN or SBC even cared to lie about. The entire UNE program, a centerpiece of the 1996 act, was a sham from the start. The incumbents were never held to any level of service at any level of interconnection, eventually their competitors just ran out of money, and they swept up the infrastructure and customer base for pennies on the dollar. ATT and VZN have used this windfall to dominate spectrum auctions and so inevitably the wireless market. They compete with each other as hard as e.g. Mastercard and Visa, about what one would expect from Ma Bell's two daughters. "Broadband investment" is a bizarre metric to even mention, when discussing a captured regulator of generations-old monopolistic firms. How did they afford that buildout? They let investors in victim firms pay for it.
It is possible that the various parties who have been doing the same thing, in different guises, for 84 years will do something different in the near future. It is possible that in introducing 5G they are making a mistake on the order of allowing the microwave oven in the ISM band. Viewed over the long run, it just doesn't seem very likely. What seems more likely is that they will continue harvesting monopoly rents and spending some small portion of those rents on keeping their regulator captured and their customers without options. There are procedures for sharing pole space, and FCC has just put municipalities on notice that they will keep their thumb on that scale too.
"Millimeter waves are broadcast at frequencies between 30 and 300 gigahertz, compared to the bands below 6 GHz that were used for mobile devices in the past."
In 2011 the WHO (World Health Organization) panel of scientists decided to label Cell Phones as possibly cancer causing after a review of the available studies: http://www.cnn.com/2011/HEALTH/05/31/who.cell.phones/index.h...
This past year the department within the US government responsible for studying toxic effects released a preliminary report showing an increase in brain and heart cancer rates within male mice exposed to 2G and 3G wireless radiation: https://ntp.niehs.nih.gov/results/areas/cellphones/index.htm...
That's not to mention the personal stories of cell-phone induced brain cancers that have been circulating since the 80s. For instance: my brother-in-law's dad died of brain cancer, and he was a business man who was on his cell phone almost 24/7.
Exposing the majority of the US population to higher frequency waves than the ones already under suspicion of causing cancer seems like a bad call without further study.
https://www.cancer.gov/about-cancer/causes-prevention/risk/r...
Generally, there does not seem to be strong scientific evidence supporting a causal relationship between non-ionizing radiation exposure and increased cancer rates at ordinary levels.
I did find your linked study (https://ntp.niehs.nih.gov/results/areas/cellphones/index.htm...) interesting but wanted to point out a few things:
1) These mice were subjected to whole body exposure for their entire lives (from utero to old age) 18.5 hours a day (9 hours of actual sustained exposure) which seems to be of questionable relevance to real-world human conditions. From one of the reviewers:
"There may be also several caveats relating to “under the conditions of these studies”, including how well the conditions recapitulate actual human exposure: whole body exposure from in utero to old age; 18.5 hours/day (10 min on/10 min off, for total of 9hr actual exposure); and dose;"
2) Only male mice in the sample demonstrated statistically significant differences from the control group, female mice did not. This is odd...and the reviewers take note:
"My concern regarding the control data came from the following two considerations. First, we need to consider sample variation. The incidence rates of the current controls for brain gliomas and heart schwannomas were 0. However, the historical controls were 1.67% for gliomas (range 0-‐8%) and 1.30% for schwannomas (0-‐6%). Given that there were substantial variations among the historical controls and the concurrent control is at the lowest end of the range, it is important to evaluate how different estimates of control incidence rates may impact the results of analyses. ... Second, it is puzzling why the control had short survival rate. Given that most of the gliomas and heart schwannomas are late-‐developing tumors, it is possible that if the controls were living longer some tumors might develop."
That is to say the male control group didn't have any tumors develop but they also lived for shorter period of time than the the other groups (ostensibly also the female control). This is odd and explains a possible false-positive scenario where a short lived control group had a 0% expression of tumors naturally because they didn't live long enough for the tumors to develop.
Still an interesting result, but also a good illustration of why science places emphasis on reproducible results.
3) Implied/mentioned by #2, but there were no statistical variations between the female control group and the radiated female group. Perhaps female mice are resistant...or perhaps the male control was a non-representative sample. Either way this difference raises questions and the possibility of a false-positive.
So at the end of reading, I find this reviewer's summary to be most relatable:
"Looking at the data, I agree with the report’s conclusion: Under the conditions of these studies, the hyperplastic lesions and neoplasms observed in male rats are considered likely the result of exposures to GSM- and CDMA- modulated RFR. The findings in the heart were statistically stronger than the findings in the brain. But note, it is “considered likely” not “definitely is”...Results from the companion mouse study will hopefully add some insight."
The keys being "Under the conditions of these studies" which may not be relatable to real-world human exposure as well as " “considered likely” not “definitely is” ". So to your point:
> Exposing the majority of the US population to higher frequency waves than the ones already under suspicion of causing cancer seems like a bad call without further study.
There is ongoing research and study...some dating back to the early-mid 2000's...and so far there hasn't been sufficient evidence to show (or suggest) a causal link between non-ionizing radiation and cancer risk. At least that is my layman's understanding.
Their "think tank" organization TechFreedom is funded by the wireless industry and the Koch brothers. TechFreedom has also been (still is?) a member of ALEC.
Jon Henke is a Republican political consultant and self-described "neo-libertarian". https://en.wikipedia.org/wiki/Jonathan_Henke
If Verizon continues to pay $10,000 to use a city owned utility pole, then I'm pretty sure the price is right.
The article you cite is irrelevant to the current debate.
Article you cite is about cable & broadband. Current issue is about cell.
Article blames government for squelching competition. Ignores phenomenon of regulatory capture.
Capitalists like me believe, without proof, that the job of government is to protect the marketplace, ensure competition. Laissez fair minded people only advocate deregulation, which is anti-market, anti-competition.
Article advocates 'open access'. That's probably a good idea, for cable. And everyone's for more efficiency. But I'm unclear how this notion translates to cell or how it relates to fees.
Current FCC action imposes price controls, dictates procedures. So consumer friendly regulations bad, corporate friendly regulations good? Again, libertarian rhetoric (Freedom Markets™) doesn't match their actions. aka Hypocrisy.
Did I leave anything out?
Giving cities control over this is just a NIMBY dream.
how about we barter, we'll give a smaller range (a fixed rate really isn't a good reality) and then the ISP's have to disband their lobbying efforts for ten years. Also they need to undo each state and local law they had put in place to prevent city and states from creating their own local ISP service. Oh, and Pai has to quit and be banned from working at any ISP for at least two decades.
i'll be here waiting with my full support to these terms.