BEFORE
THE
FEDERAL COMMUNICATIONS
COMMISSION
Washington, D.C.
20554
| In the Matter of | ) | |
| Inquiry Concerning the Deployment | ) | |
| of Advanced Telecommunications | ) | |
| Capability to All Americans in a | ) | CC Docket 98-146 |
| Reasonable and Timely Fashion, | ) | |
| and Possible Steps to Accelerate | ) | |
| Such Deployment Pursuant to | ) | |
| Section 706 of the | ) | |
| Telecommunications Act of 1996 | ) |
Comments of Information Renaissance
1. Summary
Information
Renaissance respectfully submits the following comments in the Federal
Communications Commission’s (FCC’s) Notice of Inquiry (NOI) under
Section 706 of the Telecommunications Act of 1996. Sections 2-5 of this
document discuss questions posed in the FCC’s August 7, 1998 NOI document
on which Information Renaissance has a useful perspective. The questions are
addressed in the sequence outlined in the FCC’s NOI. Section 6 requests
an extension of the comment period to gain further input from the general public
- the actual and potential users of advanced telecommunications capability.
Section 7 provides a description of Information Renaissance’s
activities.
Information Renaissance makes the
following major points:
2. Definition of "Advanced Telecommunications Capability" (NOI, Section II.A.1) Paras. 13-17.
Paragraph 13 of the NOI seeks comment on the meaning of
“advanced telecommunications capability” and on the meaning of the
terms which comprise its statutory definition: “high-speed, switched,
broadband telecommunications capability that enables users to originate and
receive high-quality voice, data, graphics, and video telecommunications using
any technology.”
Information Renaissance
believes that the definition of advanced telecommunications capability should
include high bandwidth, bi-directional and symmetrical features. The
requirement for “switched” capability should also include
“packet-switching” and not be limited to circuit-switching.
Advanced telecommunications capability should be sufficient to enable the
following services universally: high-quality audio, video conferencing,
distributed file systems, and
telemedicine.
Advanced telecommunications
capability is not any single service. Thus it is not purely a broadcast service,
which lacks the function of information exchange; nor is it purely
circuit-switching, which is inefficient and resource intensive for many data and
audio-visual applications; and it does not necessarily require new physical
layer construction, but might involve the installation of new electronics on an
existing wiring plant.
The definition should also
incorporate the idea of an evolving standard. The FCC should start with a
baseline standard defined in terms of specific targeted services, and
periodically review that standard to keep it consistent with changing
technological possibilities and evolving application needs. The FCC should
apply certain measures and incentives to encourage the capability considered
advanced at any time. As new technologies become commonplace, these measures and
incentives would be removed in the course of the Commission’s periodic
review.
The Internet provides a ready example of
services that cannot be provided to all Americans by present-day infrastructure.
Applications with extensive audio and video components cannot reach the vast
majority of end users. Shortcomings exist both in the local loop and in the
inter-office and intra-LATA facilities used for aggregation of the local loop
traffic. The broad deployment of advanced telecommunications capability as
defined above could eliminate these shortcomings.
3. Current and Future Deployment of Advanced
Telecommunications Capability -- Existing and Planned Facilities (NOI, Section
II.A.2) Paras. 18-58.
The current baseline for
telecommunications capability is sufficient to provide residential users with
low fidelity audio services, broadcast (or unidirectional) video, and data at
less than 64 kilobits per second. The typical baseline capability for office
users is simply the aggregation of the same level of
services.
The purpose of section 706 and this
proceeding is to determine how to raise the bar for such services. These issues
are discussed in more detail below.
4. Reasonable and Timely Deployment (NOI, Section II.B) Paras. 59-68.
a. Meaning of "reasonable and timely deployment", Para. 59.
(i) “Reasonable and timely
deployment”
Paragraph 50 of the NOI asks
for comment on the meaning of the term “reasonable and timely
deployment” – whether this requires the adoption of objective
targets or a time-specific schedule.
Information
Renaissance believes that advanced telecommunications capability evolves and
that policies to encourage its development must also evolve. We therefore
believe that the FCC should periodically identify specific capabilities that it
plans to encourage and specific, case-determined time schedules to complete
those plans.
(ii) “To all
Americans”
Subsection (a) of section 706
requires the FCC and state Commissions to encourage the deployment of advanced
telecommunications capability “to all Americans (including, in particular,
elementary and secondary schools and classrooms)”. Subsection (b)
establishes the same scope as the focus of this proceeding – to
“determine whether advanced telecommunications capability is being
deployed to all Americans” in a reasonable and timely fashion. What does
it mean to provide capability “to all Americans”? Information
Renaissance believes that the term must be interpreted literally – that
Congress intended that “all Americans” include access both by
businesses and by individuals in their residences, meaning access at work and at
home. With “all Americans” thereby defined as the standard, the
next question becomes what method of deployment is “reasonable and
timely”. It may not be realistic to expect the immediate deployment of
such capability on a universal basis. It is important, however, to retain the
ultimate goal of access for all people, regardless of income and geographic
location.
The goal of such universal access should
not be relegated to the Act’s provisions on Universal Service. The FCC
should implement sections 706 and 254 in a complementary way. Both have the
goal of universal access. Section 254 addresses the issue of Universal Service
funding to ensure such access. Section 706 provides the potential for
additional tools to achieve the goal.
In this
context, it is also important to identify the Americans who are most at risk of
not obtaining access. Much attention is paid to the needs of rural users and
the relatively higher costs of providing facilities in less densely populated
areas, which may also suffer from relatively lower incomes. Without discounting
that problem, it is also important to note a similar problem of access facing
the inner city. Neighborhoods that lie outside the downtown central business
district may be more costly to serve than the central business district and may
also lack the incomes and use characteristics that demonstrate to providers the
profitability of extending advanced telecommunications capability. This problem
is true not only for low-income residential users but for small- and
medium-sized businesses and organizations located outside the central business
district.
b. Demand for Advanced Telecommunications Services, Para. 60.
(i) Nature of demand
Paragraph 60 of the NOI asks for comment on
the nature of current and projected demand for advanced telecommunications
capability. In response Information Renaissance notes the following present
uses, which serve important community goals, such as education, community
development and economic
revitalization.
Education:
Community development:
Economic revitalization:
Some of these uses can
be provided with existing facilities and services – although often at low
speeds that limit the usefulness of the user’s application. The number of
users, however, increases continually, and the volume of data received and
transmitted by each user also increases, posing a substantial need for
additional capability. Also, the anticipated use of inexpensive network
computers (or “thin clients”) will rely upon high-speed links to
network servers. Greater bandwidth is similarly required for the expanding uses
of collaborative applications in education, community development and economic
revitalization.
More specific data-intensive uses,
which are becoming more widespread, include the
following:
Education:
Community development:
Economic revitalization:
(ii) Capability required to meet the needs; fungible
capability versus specific kinds
Paragraph 60
of the NOI also asks, in view of the uncertainties over the future direction of
applications, whether the best policy is “to stimulate the deployment of
‘raw’ capability that would be fungible enough to satisfy whatever
demand evolved.”
Information Renaissance
submits that the essential outlines of the uses are sufficiently clear to
establish goals. The applications will require increased bandwidth, both on the
downstream side, that is used to obtain information, and on the upstream side,
which is used to transmit information. The need for capacity in both directions
is expanding, but capacity in the upstream direction is most at risk of
inattention.
The recent development of asymmetric
telecommunications capability appears to be based upon the business model of
selling or providing large amounts of information, such as pay per view movies,
to consumers. Some of the other uses noted above are not based upon the model
of seller/transmitter and buyer/receiver, but are, instead, more equally
interactive in terms of the quantities of data exchanged. Those uses involve
the collaborations among users in education, community development and economic
revitalization.
The nature of the
telecommunications capability that should be encouraged, therefore, is with
facilities with large amounts of symmetrical bandwidth that are sufficiently
flexible to satisfy future demand.
c. Current Deployment of Advanced Telecommunications
Services, Para. 61
Paragraph 61 asks for
comment on where deployment has occurred, by whom, in what form, and for what
customers.
Information Renaissance is based in
Pittsburgh. Here, advanced telecommunications capability is being provided by
the ILEC through ISDN services and will soon be provided through Asymmetric
Digital Subscriber Line (ADSL) technology in selected parts of the City and
Allegheny County. ISDN is available to residential and business customers,
depending upon the availability of facilities and the ADSL service is being
offered to business and residential customers. A limited number of CLECS are
providing advanced telecommunications capability in the central business
district and in Oakland (the location of several universities) concentrating on
services to large businesses and institutional users. The local cable
television companies are beginning the deployment of advanced services through
cable modems, starting in selected areas outside the city. Cable companies and
alternate LECs also offer traditional data services, with only minor
differentiation from the ILEC in services and pricing.
d. Schools, classrooms, and libraries, Para.
64.
Paragraph 64 of the NOI asks for comments
about the particular needs of schools and libraries, now and in the near future,
and about reasonable and timely deployment for them. Paragraph 64 also asks
whether government programs, such as the Schools and Libraries discount program
under the Universal Service Fund will make up any shortage in private
investment. Information Renaissance has familiarity with these issues through
its founders’ work with the networking of the Pittsburgh school system and
the organization’s work with the Schools and Libraries Universal Service
discount program.
(i) Special needs, in quantity and
quality.
The needs of schools and libraries are
similar to the needs of other users on a qualitative basis. This means that
they have a need for symmetrical high-bandwidth services. The needs are, of
course, larger on a quantitative basis.
Unlike
other large users, however, which may be located in dense concentrations of
other large users, schools and libraries are generally dispersed in residential
areas. Accordingly, schools and libraries often suffer from the same lack of
infrastructure as do the neighborhoods in which they are located.
(ii) Effectiveness of Schools and Libraries discount
program.
The impact and effectiveness of the
Schools and Libraries discount program is unclear. The program is in its first
year, and the funds are only beginning to be distributed. The short-term
impacts, in terms of effectively providing advanced telecommunications
capability to schools and libraries, are, accordingly, not clear. Also unclear
are the longer-term impacts, whereby the increased demands from schools and
libraries would attract the deployment of advanced capabilities to the
neighborhoods in which the schools are located. This latter issue is discussed
in more detail below in the section on measures to stimulate user
demand.
e. Possible reasons for slow deployment, Para.
66.
Paragraph 66 of the NOI asks for comment on
reasons why parties may believe that advanced telecommunications capability is
not being deployed in a reasonable and timely manner. Information Renaissance
identifies five possible reasons.
(i) Protection of investments in technologies
underlying existing facilities
Companies with
substantial sums of funds invested in technologies that are already deployed
have a natural tendency to encourage the fullest use of those resources. When
the companies’ services are not subject to competition from other
providers, the companies with existing investments in older technologies may be
slow to deploy new technologies themselves. In the worst case, such companies
may exercise market and other power to discourage or prevent the entry of new
providers who would introduce the new technologies
(ii) Uncertainty over investment
priorities
A second reason relates to the pace
of technological development and the resulting uncertainty over which
technologies should receive the attention and investment resources of providers.
Deployment of new technologies on a large scale may require the expenditure of
substantial sums of funds, and providers may be cautious to avoid spending large
sums of money on capabilities that may quickly become obsolete.
(iii) Uncertainty over implementation of the Telecom
Act
A third reason relates to the efforts of
the FCC and state commissions to implement the competition-inducing provisions
of the Telecom Act. The Telecom Act requires the use of mechanisms, such as
unbundling and resale, to spur the entry of new providers and encourage the
development and deployment of new and advanced telecommunications capabilities.
The terms approved by the regulatory agencies have been challenged by potential
entrants as being insufficient to encourage
competition.
In addition, the Telecom Act
prohibits the entry of former Regional Bell Operating Companies (RBOCs) into the
long distance market until the RBOCs have complied with the Act’s
requirements to open the local exchange market to competition. Long distance
carriers may be objecting to the unfairness of the competition-inducing terms
established by the agencies and postponing their own entry into the local
exchange markets to protect their competitive positions in the long distance
market.
(iv) Decreased competition resulting from
mergers
A fourth reason, related to the first
and second reasons, may be merger activity and the increasing concentration
among telecommunications service providers. Companies entering into mergers
argue that the greater concentration of resources is necessary to undertake the
large capital investments required to deploy advanced telecommunications
capability. Critics argue that the mergers eliminate potential competitors that
might otherwise deploy advanced capabilities and that the larger company has the
market power to preserve its embedded investments and prevent the entry of
further competitors.
(v) Lack of effective
demand
A fifth reason may be lack of effective
demand. Providers target customers that present the greatest profit
opportunities and proceed slowly, if at all, to deploy facilities to serve other
customers. Reasons may include the high cost of deploying facilities to such
customers, the lack of perceived demand, or a combination of those factors.
Measures to stimulate demand and deployment are discussed below in section
5. The FCC should be attentive to all of these possibilities.
5. Removing Barriers to Infrastructure Investment and Promoting Competition (NOI, section II.C) Paras. 69-84.
a. Recommendations on use of price-cap regulation, regulatory forbearance, measures that promote competition in the local telecommunications market, or other regulating methods that remove barriers to infrastructure investment, Paras. 69-70.
(i) Measures to promote competition: refinement of
terms for Unbundled Network Elements and
Resale
As noted above, potential competitors
in the local exchange market have been slow to deploy facilities and competing
services based upon their claims that the terms approved by the FCC and state
commissions for the unbundling of network elements, resale and collocation are
not sufficient to provide profitable deployments of facilities. Proceedings are
underway before state commissions, including the Pennsylvania Public Utility
Commission, to determine whether the terms need to be modified.
The FCC should also address these issues,
especially in regard to the whether the terms provide sufficient access to
unbundled network elements required to provide advanced telecommunications
services, such as DSL technologies.
(ii) Review of
mergers
The FCC should explicitly include in
its review of proposed mergers the issue of the impact that the mergers will
have on the deployment of advanced telecommunications capability. As noted
above, mergers may be used to gain and preserve market power or they may be used
to gain access to the resources required to deploy advanced telecommunications
capability on a large scale. The FCC should review proposed mergers from these
perspectives and attach appropriate conditions in its disposition of the
companies’ requests.
(iii) Measures to promote
demand
A basic economic principle is that the
supply of a product grows to satisfy the demand for the product. With advanced
telecommunications capability, however, the growth of demand depends, in
important part, upon the supply of the capability.
The Internet is a relatively new creation.
People can use the Internet for important social and economic purposes, and new
uses for the technology are being developed at a steadily increasing rate.
However, the growth of the uses and the rate at which existing and new users
expand their use of the applications depends in large part upon people’s
familiarity with Internet technology and their awareness of how they can use the
technology to help themselves.
In an important
sense, therefore, access to the Internet is important to the increased demand
for access. The increased demands should encourage further growth in
supply.
The following discussion describes three
mechanisms that can be used to stimulate demand and supply of advanced
telecommunications capability.
Infrastructure that
is shared among various public sector users can aggregate enough demand to make
a region more attractive to profit driven suppliers. Those users can also
benefit from economies of scale in the supplied
infrastructure.
Information Renaissance works with
community groups and residents to establish community access sites to bring
Internet access to residents who may be otherwise be unable to gain access to
the necessary resources. The primary objective of the sites is
capacity-building – to help people gain tools to solve problems. The
computer access sites give communities access to the technological power of the
Internet and enable communities to focus on problems which the communities
consider important and in ways they control.
Community access sites aggregate demand in central
locations and educate the public to the power and usefulness of the
technologies. The aggregation provides greater profit opportunities for service
providers and leads to the wider use and economic demand for the services.
Equally significant, the sites rely upon
partnerships for the resources required to establish and operate them.
Information Renaissance uses two kinds of partnerships. The first set of
partnerships includes foundations, government agencies and private corporations,
which provide funds and hardware for the computer networks. The second set
includes collaborations with community groups to establish and provide sites and
personnel for a sustainable operation.
Our
experience suggests that incentives for the establishment of shared public
networking infrastructure could greatly increase the scope of municipal
partnerships involving schools, libraries, government agencies and community
groups. A possible model for such incentives may be found in the
“institutional networks” established as part of many cable
television franchise agreements. Such networks provide infrastructure reserved
for public sector use and maintained as a shared public facility. Without
incentives for the establishment of infrastructure of this type, it is likely
that each major public organization - the school system, the library system, the
public safety system, etc. - will seek to establish separate and redundant
networks. While such networks can bring significant profits to network
suppliers, they are intrinsically hard to maintain and ultimately limit the
scope of public access to network facilities and resources.
Information Renaissance supports
the proposal of the Alliance for Public Technology (APT) to create a task force
to develop community/provider partnerships to create demand-pull incentives for
infrastructure development for residential and other under-served areas. Our
experience with the development of community networks shows that such
partnerships can be useful to stimulate demand for advanced telecommunications
capability and services in under-served areas. It also shows the extensive need
for such partnerships.
The effectiveness of the
Task Force will depend upon the participation of the communities affected. This
participation can be encouraged in several ways. First, community
representation is important in the membership of the Task Force. Second, the
Task Force’s work must be open to the public. That means that the public
must have access to the Task Force’s meetings and processes. It also
means that the Task Force should actively recruit public input into its reviews.
There should be an active outreach program to publicize the Task Force’s
work and solicit public participation. The outreach effort should use physical
forums and online mechanisms to publicize the Task Force’s work, to
educate the public on the possibilities and issues, and to create a broad public
discussion.
The discounts under the
Schools and Libraries discount program under the Universal Service fund
translate into substantial purchasing power. This power may attract the
attention, facilities and services of telecommunications service providers. The
opportunity to form consortia of schools and libraries provides further for the
aggregation of demand and the stimulation of investment. The Schools and
Libraries discounts may not be sufficient, however, to attract advanced
capability sufficient to address the remaining needs of an under-served
area.
The Task Force on Universal Service
established by the Pennsylvania Public Utility Commission has acknowledged the
potential of the discounts and consortia to stimulate infrastructure development
but noted that the Schools and Libraries discount program discourages school and
library consortia from including other entities, such as municipalities,
community groups and small businesses. The Task Force’s report was
approved by the PUC on March 19, 1998 in its investigation on Universal Service.
See Re: Formal Investigation to Examine and Establish Updated Principles for
Telecommunications Services in the Commonwealth; Final Report and Recommendation
of the Universal Service Task Force, Docket No. I-00940035 (Order entered
March 19, 1998). The Pennsylvania Task Force stated that larger mixed consortia
could have a greater impact on infrastructure development. It recommended
further research to determine the best means to take advantage of a common,
single source to advertise aggregated demand. It stated that such a mechanism
could be implemented at the state level but that it would be more effective at
the federal level.
Information Renaissance
recommends that the FCC take all possible measures to facilitate the
establishment of consortia under the Schools and Libraries program and that it
recommend to Congress that eligibility for the discounts be expanded to include
community groups and non-profit organizations. The addition of these other
groups will substantially expand the purchasing power of users in under-served
areas and attract the extension of advanced capabilities to those
areas.
6. Request for Additional Public
Comment
Paragraph 12 of the NOI welcomes
comment “from those who could be directly affected by the outcome of this
proceeding, such as consumers, schools and libraries, and rural health care
providers.” Schools, in particular, should have the opportunity to
present input, as their classrooms are specifically targeted under section 706
for analysis. Unlike the other likely participants in this proceeding, actual
citizen users of services and dispersed organizations, such as schools and
libraries, generally lack the resources and organization to gear up quickly for
a proceeding like this. Information Renaissance, accordingly, requests that the
public comment period for the NOI be extended or that a further public comment
period be established to gain input from the actual and potential users of the
service.
7. Background on Information
Renaissance
Information Renaissance and its
founding personnel have experience in three areas relevant to this proceeding:
(1) the establishment of community networks serving community groups, non-profit
organizations and residents in urban neighborhoods; (2) the establishment of
networks in urban schools; and (3) the conduct of online seminars related to the
Universal Service Schools and Libraries discount program. Our experience has
given us familiarity with the needs of actual residential users and users who
gain access through community schools, libraries and other community access
sites.
Our experience stems from Information
Renaissance’s three categories of programs – programs that provide
access through community networks, programs that advocate regulatory policies to
improve access and programs that encourage the development of online resources.
The overall mission of Information Renaissance, which was formed as a
not-for-profit corporation in January 1996, is to promote the development of
network infrastructure in support of education, community development and
economic revitalization.
a. Access through community
networks.
Information Renaissance was formed as
an outgrowth of Common Knowledge: Pittsburgh, a pioneering school networking
effort in the Pittsburgh Public Schools, funded by the National Science
Foundation. Common Knowledge explored methods to establish a metropolitan area
network among the Pittsburgh Public Schools, to connect these schools to the
Internet and to make use of networking technology in the classroom.
Subsequently, in Bridging the Urban Landscape, a program funded by the
Department of Commerce’s Telecommunications and Information Infrastructure
Assistance Program, we helped extend this access to community groups. The
Bridging the Urban Landscape program involved community access sites, online
resources for educational use and research into connectivity
options.
The current work of Information
Renaissance extends Internet connectivity to residential areas. We help
community groups establish computer labs and access points where the public can
use computer technology and the Internet. We also work with the Housing
Authority of the City of Pittsburgh to establish community-based networking
facilities for public housing residents. These are the kinds of services that
bring the benefits of advanced telecommunications services to the potential
“have-nots”, such as students in need of computer facilities and
Internet access which their families cannot afford.
An essential thread in each of the projects is
affordability and sustainability. We regularly aggregate demand through shared
infrastructure to achieve physical and economic scales of efficiency. We also
train residents to operate and maintain the systems and to develop new
community-based applications.
b. Access through improved regulatory
policies.
We have also been active in the
development of Universal Service policies on the state and federal levels. In
1996, we conducted an on-line seminar for teachers and librarians to review and
comment on the FCC’s proposed rules for Universal Service. The seminar
educated the participants about the FCC’s proposals and the underlying
issues and obtained, organized and submitted their comments to the agency. Last
fall, we conducted a similar seminar on behalf of the Governor’s Office of
Information Technology and presented the results to the Pennsylvania Public
Utility Commission. The FCC seminar involved 500 participants representing 50
states and Puerto Rico. The Pennsylvania seminar included 400 registrants,
representing 56 of Pennsylvania’s 67 counties.
c. Access to
content.
Our third and related work area
involves the creation of online resources. These include a variety of
educational and governmental resources. As part of the Universal Service
seminars, we helped encouraged the online placement of relevant government
documents, which would have otherwise been largely unavailable to the public.
These materials are available at
http://www.info-ren.org
Respectfully
submitted,
Ashley C.
Schannauer
Attorney
Information
Renaissance
600 Grant
Street
Suite
2980
Pittsburgh, PA
15219
(412) 471-4636
(412) 471-1592
FAX
Dated: September 14,
1998