[Ars]Microsoft: broadband stimulus should help schools, hospitals

The Microsoft corporation has weighed in on how the government should spend its billions in broadband stimulus money. The software giant says that the stimulus cash should be used to extend fiber networks to critical public institutions.

"With less than $7 billion in recovery funds available, we believe it is impossible to blanket the nation with the broadband capacity that our local governments, anchor institutions, businesses and residents ultimately require," Craig Mundie, Microsoft's Chief Research and Strategy Officer wrote to the Federal Communications Commission on March 25. "The question therefore becomes one of how to maximize the near- and long-term return on taxpayers’ investment in broadband."

The answer: "Connecting schools, libraries and hospitals will generate the quickest, most impactful and most equitable distribution of social benefits." 
Of course, a cynic might note that this strategy would also help maximize Microsoft's ability to distribute software. "The Internet can carry increasingly effective educational tools," Mundie's letter added, "be they lectures from the nation’s best teacher-trainers or from leading experts in basic math, science, reading and special education - or be they new educational applications that enable students to interact with multimedia information (such as [Microsoft's] WorldWide Telescope) or interact with fellow students from faraway geographies."


But to be fair, most of the industry filings that the FCC has received on how to spend this broadband dough take a similar tone of enlightened self-interest.
The laws of economics

As Ars has reported, earlier this month the FCC in tandem with the Department of Agriculture released a call for comments on the development of a broadband strategy for rural America. Microsoft's filing responds to that invitation. The American Recovery and Investment Act offers 2.5 billion in grants and loans flowing from the USDA, and another 4.7 billion in broadband funding distributed through the Department of Commerce's Broadband Technology Opportunities Program (comments for the BTOP proceeding can be found here; Julian Sanchez's overview here). As Microsoft's remarks suggest, it all probably comes to a little less than 7 billion after expenditures for items like a national broadband map are factored in. 

The FCC document asks for a whole lot of advice on how to promote interagency harmony and encourage local/state government participation. But the majority of commercial responders to this call don't have much to say about any of that. They want rural broadband policy or the stimulus package structured so that they get a share of the relevant expanding markets. 

It thus should come as no surprise that Qualcomm recommends that a rural strategy boost mobile broadband. "The laws of economics cannot be repealed," the company told the FCC on March 25. "It is far more cost effective to provide mobile broadband in rural areas, as compared to any fixed or wireline solution." Meanwhile the American Cable Association says that its members should be able to apply for grants and loans. A rural broadband strategy should streamline the application process for small and middle size cabled operators who provide or can provide ISP services, ACA suggests, and weigh the awards system in favor of them as well. "Federal agencies should give consideration to existing broadband providers," the trade group urges.

The American Petroleum Institute asks the FCC to let its member outfits build their own broadband networks in rural areas. APA complains that these companies can't compete with carriers in license auctions, and are often required to vacate spectrum to make room for new commercial providers whose services sometimes don't even extend to the remote regions they tap for oil and natural gas. 

"The Commission should takes all steps necessary to create an exclusive, private, broadband spectrum allocation," APA concludes. "A private broadband allocation will kick-start the economy, create jobs, [and] promote employment of U.S. workers beyond the traditional city centers."

And the Satellite Industry Association wants rules for the USDA's Rural Utilities Services' broadband loan program changed to include satellite service providers. "The existing restriction that limits funding eligibility to rural areas only (as defined by the USDA) turns a distinct operational advantage - satellite’s unique ubiquity and cost-effective service delivery - into an unjustified disadvantage," SIA protests. 
Demand stimulation

Then there's Connected Nation, a southeastern based non-profit dedicated to encouraging broadband use. CN has come under fire from media reform groups, who charge that its broadband mapping proposals would privatize the process. But the outfit's 15 page filing in this proceeding makes some reasonable comments—among them that the challenge in rural areas isn't just broadband deployment, it's about "demand stimulation" (as we've reported, a Pew study indicates that two thirds of Americans without broadband appear to not to want it).

"Stated simply, the business case for broadband deployment is difficult in many rural areas where computer ownership and computer use skills are low," the group delicately explains. So the problem is as much about bringing people to the technology as bringing the technology to them. Verizon's comments seems in sync with this approach. At its Thursday, March 26 meeting with the FCC, its execs stressed a "demand side" approach to broadband deployment to encourage broadband adoption. 

It's unclear from Verizon's statement what exactly that means. Connected Nation says it runs "hundreds of community-based organizations which include projects that, for example, offer computer training and educate rural business leaders about the value that broadband can bring to their businesses." The Recovery Act reserves $200 million for boosting public computer centers at community colleges and libraries, but doesn't say anything about encouraging people to go to those places and get educated about high speed Internet computing.

March 25 was the last day for filings on the FCC's rural broadband proceeding. But in this very redundant process, the agency will next solicit comments on how to develop a national broadband strategy—that invitation to be unleashed at its upcoming Open Commission meeting, scheduled for Wednesday April 8.