We finally have a realistic estimate of the cost of bringing 100Mbps to every home in America... and Light Reading labeled the cost "jaw-dropping."

Want to provide 100-Mbit/s broadband service to every U.S. household? No problem: Just be ready to write a $350 billion check. Federal Communications Commission (FCC) officials shared that jaw-dropping figure today during an update on their National Broadband Plan for bringing affordable, high-speed Internet access to all Americans. The Commission is schedule to present the plan to Congress in 141 days, on Feb. 17.

Don't get me wrong, I agree that $350 billion is a lot of money. On the other hand, we spent nearly $300 billion on surface transportation over 4 years from 2005-2009. $350 billion buys a fiber-optic network that will last considerably longer. Additionally, such a network will generate considerably more revenue than a highway. In fact, these networks will pay for themselves in most areas if they can access to low-interest loans. Consider the comments of Deputy Administrator Zufolo (of the Rural Utilities Service) from my recent panel at NATOA:

Zufolo explained the RUS decision to use its $2.5 billion in funds primarily to subsidize loans and not provide grants, as the agency's best opportunity to make the more efficient use of the federal money and have maximum impact. Because the default rate on RUS loans is less than 1% and the subsidy rate is also low, only about 7%, it costs the government only $72,000 to loan $1 million for rural network development, she said.

Let's say that RUS decides to embark on getting 100 Mbps to everyone in a rural area - some of the projects will be riskier than the standard portfolio, so let's assume it costs the federal government $100,000 to loan $1 million (makes it easier math too). In order to spur the $350 billion investment for these networks, the government would have to put up $35 billion.

We finally have a realistic estimate of the cost of bringing 100Mbps to every home in America... and Light Reading labeled the cost "jaw-dropping."

Want to provide 100-Mbit/s broadband service to every U.S. household? No problem: Just be ready to write a $350 billion check. Federal Communications Commission (FCC) officials shared that jaw-dropping figure today during an update on their National Broadband Plan for bringing affordable, high-speed Internet access to all Americans. The Commission is schedule to present the plan to Congress in 141 days, on Feb. 17.

Don't get me wrong, I agree that $350 billion is a lot of money. On the other hand, we spent nearly $300 billion on surface transportation over 4 years from 2005-2009. $350 billion buys a fiber-optic network that will last considerably longer. Additionally, such a network will generate considerably more revenue than a highway. In fact, these networks will pay for themselves in most areas if they can access to low-interest loans. Consider the comments of Deputy Administrator Zufolo (of the Rural Utilities Service) from my recent panel at NATOA:

Zufolo explained the RUS decision to use its $2.5 billion in funds primarily to subsidize loans and not provide grants, as the agency's best opportunity to make the more efficient use of the federal money and have maximum impact. Because the default rate on RUS loans is less than 1% and the subsidy rate is also low, only about 7%, it costs the government only $72,000 to loan $1 million for rural network development, she said.

Let's say that RUS decides to embark on getting 100 Mbps to everyone in a rural area - some of the projects will be riskier than the standard portfolio, so let's assume it costs the federal government $100,000 to loan $1 million (makes it easier math too). In order to spur the $350 billion investment for these networks, the government would have to put up $35 billion.

We finally have a realistic estimate of the cost of bringing 100Mbps to every home in America... and Light Reading labeled the cost "jaw-dropping."

Want to provide 100-Mbit/s broadband service to every U.S. household? No problem: Just be ready to write a $350 billion check. Federal Communications Commission (FCC) officials shared that jaw-dropping figure today during an update on their National Broadband Plan for bringing affordable, high-speed Internet access to all Americans. The Commission is schedule to present the plan to Congress in 141 days, on Feb. 17.

Don't get me wrong, I agree that $350 billion is a lot of money. On the other hand, we spent nearly $300 billion on surface transportation over 4 years from 2005-2009. $350 billion buys a fiber-optic network that will last considerably longer. Additionally, such a network will generate considerably more revenue than a highway. In fact, these networks will pay for themselves in most areas if they can access to low-interest loans. Consider the comments of Deputy Administrator Zufolo (of the Rural Utilities Service) from my recent panel at NATOA:

Zufolo explained the RUS decision to use its $2.5 billion in funds primarily to subsidize loans and not provide grants, as the agency's best opportunity to make the more efficient use of the federal money and have maximum impact. Because the default rate on RUS loans is less than 1% and the subsidy rate is also low, only about 7%, it costs the government only $72,000 to loan $1 million for rural network development, she said.

Let's say that RUS decides to embark on getting 100 Mbps to everyone in a rural area - some of the projects will be riskier than the standard portfolio, so let's assume it costs the federal government $100,000 to loan $1 million (makes it easier math too). In order to spur the $350 billion investment for these networks, the government would have to put up $35 billion.

We finally have a realistic estimate of the cost of bringing 100Mbps to every home in America... and Light Reading labeled the cost "jaw-dropping."

Want to provide 100-Mbit/s broadband service to every U.S. household? No problem: Just be ready to write a $350 billion check. Federal Communications Commission (FCC) officials shared that jaw-dropping figure today during an update on their National Broadband Plan for bringing affordable, high-speed Internet access to all Americans. The Commission is schedule to present the plan to Congress in 141 days, on Feb. 17.

Don't get me wrong, I agree that $350 billion is a lot of money. On the other hand, we spent nearly $300 billion on surface transportation over 4 years from 2005-2009. $350 billion buys a fiber-optic network that will last considerably longer. Additionally, such a network will generate considerably more revenue than a highway. In fact, these networks will pay for themselves in most areas if they can access to low-interest loans. Consider the comments of Deputy Administrator Zufolo (of the Rural Utilities Service) from my recent panel at NATOA:

Zufolo explained the RUS decision to use its $2.5 billion in funds primarily to subsidize loans and not provide grants, as the agency's best opportunity to make the more efficient use of the federal money and have maximum impact. Because the default rate on RUS loans is less than 1% and the subsidy rate is also low, only about 7%, it costs the government only $72,000 to loan $1 million for rural network development, she said.

Let's say that RUS decides to embark on getting 100 Mbps to everyone in a rural area - some of the projects will be riskier than the standard portfolio, so let's assume it costs the federal government $100,000 to loan $1 million (makes it easier math too). In order to spur the $350 billion investment for these networks, the government would have to put up $35 billion.

We finally have a realistic estimate of the cost of bringing 100Mbps to every home in America... and Light Reading labeled the cost "jaw-dropping."

Want to provide 100-Mbit/s broadband service to every U.S. household? No problem: Just be ready to write a $350 billion check. Federal Communications Commission (FCC) officials shared that jaw-dropping figure today during an update on their National Broadband Plan for bringing affordable, high-speed Internet access to all Americans. The Commission is schedule to present the plan to Congress in 141 days, on Feb. 17.

Don't get me wrong, I agree that $350 billion is a lot of money. On the other hand, we spent nearly $300 billion on surface transportation over 4 years from 2005-2009. $350 billion buys a fiber-optic network that will last considerably longer. Additionally, such a network will generate considerably more revenue than a highway. In fact, these networks will pay for themselves in most areas if they can access to low-interest loans. Consider the comments of Deputy Administrator Zufolo (of the Rural Utilities Service) from my recent panel at NATOA:

Zufolo explained the RUS decision to use its $2.5 billion in funds primarily to subsidize loans and not provide grants, as the agency's best opportunity to make the more efficient use of the federal money and have maximum impact. Because the default rate on RUS loans is less than 1% and the subsidy rate is also low, only about 7%, it costs the government only $72,000 to loan $1 million for rural network development, she said.

Let's say that RUS decides to embark on getting 100 Mbps to everyone in a rural area - some of the projects will be riskier than the standard portfolio, so let's assume it costs the federal government $100,000 to loan $1 million (makes it easier math too). In order to spur the $350 billion investment for these networks, the government would have to put up $35 billion.

We finally have a realistic estimate of the cost of bringing 100Mbps to every home in America... and Light Reading labeled the cost "jaw-dropping."

Want to provide 100-Mbit/s broadband service to every U.S. household? No problem: Just be ready to write a $350 billion check. Federal Communications Commission (FCC) officials shared that jaw-dropping figure today during an update on their National Broadband Plan for bringing affordable, high-speed Internet access to all Americans. The Commission is schedule to present the plan to Congress in 141 days, on Feb. 17.

Don't get me wrong, I agree that $350 billion is a lot of money. On the other hand, we spent nearly $300 billion on surface transportation over 4 years from 2005-2009. $350 billion buys a fiber-optic network that will last considerably longer. Additionally, such a network will generate considerably more revenue than a highway. In fact, these networks will pay for themselves in most areas if they can access to low-interest loans. Consider the comments of Deputy Administrator Zufolo (of the Rural Utilities Service) from my recent panel at NATOA:

Zufolo explained the RUS decision to use its $2.5 billion in funds primarily to subsidize loans and not provide grants, as the agency's best opportunity to make the more efficient use of the federal money and have maximum impact. Because the default rate on RUS loans is less than 1% and the subsidy rate is also low, only about 7%, it costs the government only $72,000 to loan $1 million for rural network development, she said.

Let's say that RUS decides to embark on getting 100 Mbps to everyone in a rural area - some of the projects will be riskier than the standard portfolio, so let's assume it costs the federal government $100,000 to loan $1 million (makes it easier math too). In order to spur the $350 billion investment for these networks, the government would have to put up $35 billion.

In all the wrangling over how we should define broadband, I wanted to step back and remember why the definition is important. Information networks have become essential for business, education, and entertainment. The broadband definition originally meant something faster than the dial-up speeds that topped out at 56kbps. In the late 90's, any connection faster than dial-up pretty much supported all Internet activities. Over the years, some connections got faster while the slower connections were expanded to more people across the United States. In 2009, people who remain stuck with dial-up would be happy to get the slow speeds that first became available when DSL and cable modems debuted. On the other hand, many no longer consider those connections (often in the neighborhood of 200kbps to 768kbps for download speeds and even slower for upload speeds) to be capable of supporting many modern applications. When the broadband definition supported all the applications users wanted to run, it was useful for subscribers. However, as the broadband definition has lagged farther and farther behind modern applications, it has become only useful to large companies like Comcast, AT&T, Verizon, and Qwest because they could brag that they were delivering "broadband" to most of their customers. The result is a country that can claim x% of the population has access to broadband without that number really telling us anything. We do not know how many home users have access to connections that will support working from home or two-way video chat. We do not know how many businesses can access the speeds they need to be competitive in a real-time world. When the FCC revises the broadband definition, it must make it more stringent for the following reasons:

1. Subscribers need accurate information to make informed decisions. If they subscribe to "broadband," they should immediately know if it will actually support modern applications. This means incorporating common usage scenarios: multiple devices concurrently using a connection for browsing, e-mail, games, video-chats, media downloads, and large file uploads (online backup is becoming more popular and easy and people increasingly want to work effectively from home).
2. Large companies, particularly telephone carriers, claim that there is no need for government intervention in broadband because almost everyone has access under the existing definition.

In all the wrangling over how we should define broadband, I wanted to step back and remember why the definition is important. Information networks have become essential for business, education, and entertainment. The broadband definition originally meant something faster than the dial-up speeds that topped out at 56kbps. In the late 90's, any connection faster than dial-up pretty much supported all Internet activities. Over the years, some connections got faster while the slower connections were expanded to more people across the United States. In 2009, people who remain stuck with dial-up would be happy to get the slow speeds that first became available when DSL and cable modems debuted. On the other hand, many no longer consider those connections (often in the neighborhood of 200kbps to 768kbps for download speeds and even slower for upload speeds) to be capable of supporting many modern applications. When the broadband definition supported all the applications users wanted to run, it was useful for subscribers. However, as the broadband definition has lagged farther and farther behind modern applications, it has become only useful to large companies like Comcast, AT&T, Verizon, and Qwest because they could brag that they were delivering "broadband" to most of their customers. The result is a country that can claim x% of the population has access to broadband without that number really telling us anything. We do not know how many home users have access to connections that will support working from home or two-way video chat. We do not know how many businesses can access the speeds they need to be competitive in a real-time world. When the FCC revises the broadband definition, it must make it more stringent for the following reasons:

1. Subscribers need accurate information to make informed decisions. If they subscribe to "broadband," they should immediately know if it will actually support modern applications. This means incorporating common usage scenarios: multiple devices concurrently using a connection for browsing, e-mail, games, video-chats, media downloads, and large file uploads (online backup is becoming more popular and easy and people increasingly want to work effectively from home).
2. Large companies, particularly telephone carriers, claim that there is no need for government intervention in broadband because almost everyone has access under the existing definition.

This is a slightly older story, but I wanted to make sure it made the rounds. In "FCC Hires Industry Shill to Develop US National Broadband Plan," OpenLeft.com's Chris Bowers details the shady history of Scott Wallstein, the economics director of the FCC broadband task force. His past affiliations and quotes regarding the state of broadband in the U.S. are quite troubling. He has said that the U.S. does not have a broadband problem and has a long history of working with "coin operated" think tanks like Progress and Freedom Foundation (so named because they tend to produce reports justifying whatever their corporate funders desire). This is deeply troubling as his past positions run directly counter to many of the values espoused by President Obama and his FCC Chairman, Julius Genachowski - particularly on the important issues of open access and network neutrality.

This is a slightly older story, but I wanted to make sure it made the rounds. In "FCC Hires Industry Shill to Develop US National Broadband Plan," OpenLeft.com's Chris Bowers details the shady history of Scott Wallstein, the economics director of the FCC broadband task force. His past affiliations and quotes regarding the state of broadband in the U.S. are quite troubling. He has said that the U.S. does not have a broadband problem and has a long history of working with "coin operated" think tanks like Progress and Freedom Foundation (so named because they tend to produce reports justifying whatever their corporate funders desire). This is deeply troubling as his past positions run directly counter to many of the values espoused by President Obama and his FCC Chairman, Julius Genachowski - particularly on the important issues of open access and network neutrality.