Wednesday, April 1, 2009

Kerry on Broadband Stimulus: "Down Payment On A National Strategy"

Sen. John F. Kerry (D-MA) 04/01/09 Boston - US Senator John F. Kerry (D-MA), Chairman of the newly reconstituted Subcommittee on Communications, Technology and the Internet of the Senate Committee on Commerce, Science, and Transportation, yesterday called the appropriation of $7.2 Billion in federal stimulus funds for broadband development in underserved areas of the nation to be a first step in a larger national effort.

“We have to view the $7.2 billion broadband investment in the stimulus package as a down payment on a national strategy to deliver broadband to rural Americans who can’t access it and urban Americans who can’t afford it", stated Kerry in a prepared statement released by his office to the media.
As reported in copyrighted stories on the Wall Street Journal's Washington Wire, and on Multichannel News online, Kerry was speaking to the annual convention of the National Cable Telecommunications Association (NCTA), the Washington based government affairs arm of the cable television industry. 

While Kerry praised the cable sector for investing in a "...$145 Billion...fiber-rich network" and creating "1.5 million" domestic jobs, broadband / telecom policy watchers will pay close attention to two aspects of his remarks as auguries of the future under a Democratic Administration and Congress.

No national policy maker in the current Congress, nor in the Obama Administration, has to date put even an estimated budgetary figure on the cost to wire (or more to the point "fiber") America's unserved regions with high speed broadband networks. Total capital expenditure (capex) numbers vary widely, especially in view of policy debates as to what constitutes "broadband" itself, and where it is actually lacking across the 50 states. Many in Congress see a total funding package being achieved via a mix of direct federal grants and loans, as seen in the stimulus package, and tax incentives for companies building out into areas lacking broadband facilities.

Sen. Jay Rockefeller (D-WV), the Chairman of the full Senate Committee on Commerce, Science and Transportation is the leading advocate in the body for the tax incentive approach. As recapped here in the last day, Rockefeller had pushed hard for significant accelerated tax incentives for rural telecom build-outs in the stimulus bill (the American Recovery and Renewal Act of 2009, ARRA) but those mechanisms were removed as the legislation moved through Congress.

Kerry's characterization of the $7.2 Billion as a "down payment" is significant coming from one of the now most influential broadband / telecom policy makers in Washington. He clearly is signaling his belief that a larger appropriations goal will be necessary, and a thorough national program for broadband ubiquity will need be carved out.
“We’ve got to develop a coherent, comprehensive national approach to broadband service in this country,” was the key phrase from his prepared text. The venue for this fresh policy approach to broadband deployment will be kicked-off at the April 8th meeting of the Federal Communications Commission (FCC), as the Commission launches its effort to frame the National Broadband Plan mandated by ARRA for promulgation in 2010.

The Senator's phrase that the US must drive broadband out to not only "...
rural Americans who can’t access it.." but also to "...urban Americans who can’t afford it..." is equally significant for broadband policy watchers. Although not the preferred policy of the executives in his cable industry audience, and certainly not that of cable's competitors at the incumbent local exchange carriers (ILECS) -- the "telcos" -- this line of argument is music to the ears of "digital divide" and "community broadband" activists and thinkers. Although most American cities are wired by multiple high capacity broadband providers, the "take rates" by paying subscribers remains low for Internet services across many urban demographics.

How will federal policy address this issue of truly affordable Internet access, and therefore truly widespread usage, in currently "underserved" areas in addition to the national mission of extending ubiquitous access to "unserved" regions?

With his speech to the cable industry yesterday, John Kerry has, at the very least, signaled he is committed to finding an answer.
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