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Wednesday, March 11, 2020

Enough with the overbuilding comments already

For those who haven't been following the overbuilding saga, the FCC released an NPRM in May, to which reply comments were due July 15th.  Now, almost 8 months later, we get a new comment from Totelcom, one of the "Texas carriers" group that started this mess.

First, my irrepressible optimism [stop laughing]: if they're submitting new info, they must think things are not going their way up at the FCC.  That's good news, because the suggestions in their petition would be disastrous.

Next, my sense of fairness: hey, I can see wanting to post reply comments to other people's reply comments, but there has to be a limit, and replying 8 months later is way past any reasonable limit.

An interesting fact tucked in the addenda that Totelcom did not intend to us to notice: competition seems to work.  Before the overbuilding, Totelcom was offering 1 Gbps Internet connections for $2,000/month or more. ("Pricing will depend on speeds requested, but could be as low as $2.00 per Mb.")  Now they are offering 1 Gbps Internet connections for $499/month.  Now what could have caused a 75% price cut in 2 years?  Customers having another option, maybe?

My summary of Totelcom's price comparison: yes, Totelcom's apples were cheaper than WTTC's oranges.  Totelcom was offering each district a connection to the Internet.  WTTC was offering a region-wide WAN with an Internet connection.  If you go apples-to-apples, Totelcom wanted $24,000/year for 1 Gbps Internet, while WTTC wanted $261,000 for 10 Gbps Internet.  Of course, the WTTC proposal required building and operating a conveyor belt (the WAN) to get the apples to the schools, but I'm sure someone thought the conveyor belt WAN would be very useful for inter-district communication.  I'm not convinced the conveyor belt is worth the cost, but then, I'm quite anti-consortium and anti-statewide-network.

But here comes the good news: Totelcom is no longer requesting the draconian rule changes it originally asked for.  Here's what they're asking for now:
  1. The Commission should require that Applicants file FCC Form 470 and RFPs in every
    zip code in which service is being requested.
  2. E-Rate Applicants should not be allowed to give preferential weight to service providers
    capable of providing service to the entire region in the bid evaluation criteria in RFPs.
  3. Service Providers should be given additional time to respond to RFPs that cover more
    than 50 miles.
  4. To increase transparency in the RFP process and ensure cost-effectiveness of proposed
    services, Applicants should be required to publish certain information regarding its
    competitive bidding process.
  5. Ineligible locations and services should be excluded from the RFP process.
  6. [R]equire USAC to evaluate whether a school or library actually needs a newly constructed fiber network before granting upfront special construction costs for the same.
To which I say:
  1. Yup, the Form 470 sucks as a vehicle to promote competition.  If I were King of the E-Rate, I'd fix that by getting the FCC out of the business of regulating the purchasing procedures of local governmental entities.  Failing that, USAC should give vendors a better way to search 470s.  Or maybe leave it to the private sector; I can think of one tool that will even map 470 applicants for you.  Or get rid of consortia, which are the cause of this confusion.
  2. Now the FCC is going to tell local governments what they should want?  If some school districts want a region-wide WAN, they should be able to ask for one.  Let them justify the cost to their local taxpayers.
  3. This is reasonable.
  4. Most of the information that they request is part of the bidding process, and should be available on request, but "published"? No.  The info on how many strands and what they'll be used for is just more onerous bookkeeping.  I understand that losing bidders always want the info on their competitors' bids, but that doesn't mean they should get it.
  5. Well, Totelcom has a point, but sometimes it makes good fiscal sense for ineligible locations (town halls, police, whatever) in a project.  E-Rate should only pay to connect eligible locations, but the plan should be allowed to include ineligible locations.  It also seems to me that including ineligible locations would be to the advantage of carriers with fiber in place, since connections to ineligible locations would not get E-Rate subsidies, and the basis of the original complaint was that E-Rate subsidies were distorting the market.
  6. Oh, lordy.  How is USAC supposed to do that?  You think USAC is full of WAN engineers?  Guess again.  School network administrators?  Nope.  And when you get down to the sub-contractor PIA reviewers who would actually be making these decisions, forget it.  I'm all for better broadband mapping.  So Totelcom, how about starting us off by sharing complete info on all your fiber deployments?
You know what, though?  This list of suggestions is much better than the suggestions that were in the original petition.

But do we get to file reply comments this late in the game?  Ex parte food fight!

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