Internet access and broadband coverage across the country is one of the many great American success stories of the innovation economy. For the last decade broadband service providers have made major investments, typically ranking as the largest capital-expenditure companies in the country year after year. Since 1996 the total investment has neared $2 trillion. That robust private investment has brought great reward. Today more than 94 percent of the U.S. population has access to broadband.
Even with that investment, there are still some without access. As George Ford of the Phoenix Center has explained, only about 3 percent of those who lack internet access at home are unserved—the rest simply choose to not purchase it. Most of those without access live in hard to reach areas where there is little to no business case to be made for broadband.
A relatively cost-effective way to reach more remote customers with broadband is to attach broadband cables to utility poles. And there are a lot of utility poles, particularly in rural areas.
While relying on poles seems easy enough, the process still involves permitting, renting space for equipment, and replacing unusable poles. Each pole requires an attachment and the pole owners charge a price for each attachment. Under the best of circumstances, the costs add up.
When a broadband provider wants to attach its cables to utility poles, the utility that owns the poles often takes advantage of the situation to not only charge outrageous attachment fees, but also to require the broadband company to pay for the entire cost of replacing worn-out poles. That would be like saying that a person would have to pay the entire cost of an amusement park ride when it needed repair because they were the next person in line who wanted to ride. Normally, of course, the owner would bear the expense.
As mundane as utility pole attachment policies may seem, these kinds of tactics are barriers to further broadband deployment to unserved rural areas.
Faced with these obstacles to deployment, broadband providers must either pay, go to court or abandon their plans. Consumers suffer as unreasonable fees and policies raise the marginal cost of rolling out broadband to areas already difficult to serve.
Charged as it is with encouraging broadband deployment, the FCC can address these problems by clarifying how pole replacement or upgrade costs can be fairly allocated between pole owners and those who seek to attach new equipment.
The good news is that the U.S. has largely gotten the big pieces of broadband policy right, which is why our broadband rollout has been such a success. Our efforts to close the distance on the last mile of broadband delivery mostly comes down to more arcane considerations like utility pole attachment and other local obstacles.
Pole owners that delay progress by holding up broadband providers are missing the forest for the poles, and the FCC should step in and help them see the light.
August 13, 2020