The last three months have been a whirlwind of proposals to many things broadband. Here, here and here. There is even a modicum of divergent thought on the issue here at ThirdPipe. I myself being camped on the side of the land rush is almost over. Adoption rates are flat because those that crave the speed or have the need have done so already. I am not saying there are areas still not served. There are. But the easy pickings have been fulfilled.

The next big chunk of user base are those in areas where laying cable just does not make sense. Here we enter the land of wireless and WISPs. It is the next logical step. But before we go off the deep end and blow a whole bunch of tax dollars we might want to reflect a moment on some interesting facts provided by a recent Pew survey –

Of dialup users

• 33% say the price of broadband would have to fall first. By how much was not indicated.
• 19% would not switch under ANY circumstance.

Of those not connected to the net at all

• Only 13% said they did not have access.
• But 33% just did not care to be online at ALL.

Of the combined group, 51% voiced some opinion that the need for broadband was not relevant to their life. That is a really telling number considering we are suggesting the expenditure of massive amounts of tax dollars for the privilege to lay cable past a house that will never use it.

Dog you must be a troglodyte! Actually no. I crave the speed that my current provider supplies me. If I have a valid reason to upgrade to even higher rates I would do it. Just don’t have the demand right now. My concern is more that of a taxpayer than a consumer. If a good chunk of the yet unserved are not going to use the service then is it wise public policy to spend the dollars to do so? One could make a very cognizant case that if the purpose of the program was to increase broadband usage then a more salient method might be a means tested tax break for those that have access to broadband but cannot afford it. (A 33% number of possible dial up switchers hampered by cost, that is a target rich environment for such a program.)

But I advocate an even better use for the funds so earmarked. Shift them to the unallocated 700mhz ‘D’ block that bombed 18 months ago. Forgo another auction in the space. It is for public service functions, treat it as such. Put those funds into the hands of the first responder communities as grants to get the build out done. Private enterprise will come along to get the sale. We as a society benefit 100% from the costs by improving our first responder performance and response times. We get a stimulus as a side benefit. The overall ‘payback’ will be much higher than that next increment of households many of which will never tap into the broadband plant even if it is available to them.

Link to Pew Report.

The FCC forgot rules that limit the amount of spectrum any one entity can control in a geographic area long enough for AT&T and Verizon to establish effective monopolies in the 700MHz band while also keeping control of their other mobile frequencies. Now the rules have returned. I’m sure we’ll stick with those rules until the Death Star of Darth V would like them to be temporarily rescinded again….

According to Michael L. Katz in an August 19, 2008 paper titled, “An Economic Analysis of the Spectrum Component of the Federal Communications Commission’s Merger Review Screen,” the first two components of the screen were based on traditional market share measures and examine the level of market concentration and the change in concentration to which the transaction under consideration would give rise. The third screening component examined whether the merged entity would hold licenses covering more than 95 MHz of spectrum. In short, the FCC’s standard competitive analysis practice is first to define the relevant product and geographic markets, then to apply an initial screen to the spectrum holdings of the applicants, and then to conduct a market-by-market analysis of the markets captured by the initial screen.

This three-part screen was used by the FCC in the AT&T/Dobson merger, the Verizon Wireless/Rural Cellular merger, and in the Verizon Wireless/Alltel merger. However, on the same day the FCC conditionally approved the Verizon/Alltel merger, the FCC released its Auction 73 — Union Telephone/Verizon Wireless Form 601 decision in which it noted its intention going forward to expand the commission’s use of the three-part screen. In the decision, the FCC for the first time stated that it “intend[s] to apply prospectively [its] standard competitive analysis to spectrum acquired via auction as well as via transactions.” In other words, from now on, the FCC will apply its 95 MHz spectrum screen to both forms of spectrum acquisition — via auction and acquisition. (RCR Wireless)