The national broadband plan that the Federal Communications Commission submits to Congress later this month is now expected to cost up to $25 billion. But since the nation's lawmakers are looking for ways to reduce the national debt, the FCC is seeking ways to offset the cost through spectrum auctions and other measures.
To have any chance of meeting its goal of providing broadband service to 100 million Americans, the FCC will need to find support for an estimated $9 billion commitment to cover underserved parts of the country, industry observers say. Moreover, the commission wants Congress to spend $12.5 billion to $16 billion over the next 10 years to provide police, firefighters and other emergency workers with wireless Internet access.
"This will better enable public safety to expand upon commercial deployments and obtain the level of coverage they need," wrote Jamie Barnett, chief of the FCC's public-safety and homeland security bureau, in a blog. "The end result will be an advanced, widely available, and robust wireless broadband network for the nation's first responders."
Seeking Revenue Neutrality
FCC Chairman Julius Genachowski said Tuesday that the billions of dollars required to implement the national broadband plan must be weighed against the escalating costs that will arise if a large number of Americans continue to be excluded from the broadband economy.
"Five years ago if you wanted to find a job, you got a newspaper and checked the classifieds; now you have to be online," Genachowski told The Washington Post in a video interview. "And as we make progress on making medical records electronic, the costs of not being connected" to the Internet are going "to get higher."
Moreover, studies from the Brookings Institute, MIT, the World Bank, and others "all tell us the same thing," Genachowski noted in a speech before the National Congress of American Indians on Tuesday. "Even modest increases in broadband adoption nationally can yield hundreds of thousands of new jobs."
To help make the FCC's plan revenue-neutral, Genachowski recently floated the idea of establishing a voluntary program under which the nation's TV broadcasters could relinquish underutilized spectrum and be financially rewarded after the U.S. government auctions the frequencies to wireless broadband providers. Such auctions could produce significant revenue that could be applied to the FCC's national broadband plan.
However, at least one influential U.S. legislator is wary of the proposal. "I am concerned about plans circulating at the FCC to mandate the reallocation of broadcasters' spectrum for mobile broadband use," said Congressman John Dingell (D-Michigan) Tuesday.
Other Funding Options
Noting that broadcasters surrendered a third of their spectrum during the digital television transition, Dingell said he remains unconvinced that the broadcasters are using their remaining spectrum inefficiently.
"It is my hope that the Congress and commission can find a way to increase the spectrum available for the purposes of mobile broadband without threatening the availability of free, over-the-air broadcasting to the public," Dingell added.
Another budgeting idea slated for further discussion in advance of the plan's March 16 release involves the Universal Service Fund established by Congress under the 1996 Telecommunications Act. All providers of telecommunications services currently make USF contributions based on projected quarterly earnings, and the fund is expected to generate $8 billion over the next 10 years. The FCC could recommend that Congress reposition USF as a "mobility fund" to aid the national broadband plan.
Additionally, the FCC intends to auction off a slice of public-safety spectrum known as the D-block next year that could help fund its plan to give the nation's first responders access to wireless broadband. This would "expand opportunities to utilize more spectrums for public safety and better leverage commercial resources," Barnett said.