The Need for Speed: A New Framework for Telecommunications Policy for the 21st Century

Introduction

1 Introduction 1 For most of those born after 1985, it is hard to imagine a world without the Internet. Although it was initially supported by government funding, the Internet has emerged as a commercial force through the efforts of actors in the private sector. Telephone companies built its fiber-optic “backbone,” which routes an unimaginably large and increasing volume of data, voice, and video traffic to Internet users through “last mile” connections to homes and offices. These connections exploit wireline and, increasingly, wireless technologies. In addition, millions of privately owned companies, big and small, provide the content on websites and applications (“apps”) that makes the Internet so popular and so valuable. The latest Internet phenomenon, social networking , illustrates how the Internet is changing not only our commercial lives but also the way that we interact with each other. We would like to thank the attendees of a Brookings policy roundtable, including Jeff Eisenach, Jason Furman, Debbie Goldman, Kevin Hassett, Thomas Hazlett, Blair Levin, and Christopher Yoo, for helpful comments on an earlier draft of this book. 2 Introduction All of this activity is made possible by broadband connections, made through the wire-based networks (millions of miles of copper -based coaxial or fiber-optic cables) and wireless networks (satellites and cell towers) that constitute the foundation of the modern Internet. The “broad” in broadband refers to the number of “bits” of voice and data that are able to travel per second through various “pipes,” or channels. When the term was first used in the 1990s, the Federal Communications Commission (FCC)—a regulatory body about which we will have much to say throughout this book—defined the minimum broadband speed to be 256,000 bits per second, or 256 kilobits per second (kbps). Just as Moore’s Law accurately predicted the doubling of computing power every twelve to eighteen months, the speed of broadband networks has advanced at a remarkable rate over the last two decades. Today, the FCC defines the minimum acceptable broadband speed at 4 megabits per second (Mbps) for downloading information (1 Mbps for uploading it), and the agency has designed many of its policies and strategies to ensure that all Americans have access to at least one provider of such a service through a fixed physical wire—coaxial, beefed-up copper, or a fiber-optic cable—and actually use it. By that definition, more than 90 percent of American households are able to buy such a service. As of 2011, the latest year for which the FCC has reliable data, only about 7 million U.S. households did not have broadband access. If wireless broadband technologies—mobile phones or satellites—are counted, the unserved population drops by anywhere from 25 to 75 percent, so that the true number of households without access to broadband at the FCC’s minimum speed is probably in the range of 2 to 5 million.1 Yet the minimum is just that, a floor. In many areas of the country , technology has made it possible to deliver broadband connections Introduction 3 at much greater speeds, double or more the 4 Mbps threshold. By 2012, cable infrastructure had been upgraded to so-called “next generation technology” (labeled DOCSIS 3.0), achieving average download speeds of 15 to 20 Mbps. At that time the technology was available in almost 100 million U.S. households, and telephone fiber-optic service at similar speeds was available in roughly half that number of homes. In addition, advanced 4G LTE wireless service with download speeds of 15 Mbps—the latest in seemingly never-ending jumps in technological capability, like the increases in the power of computer chips—was offered by providers such as AT&T and Verizon in many parts of the country , and certainly more areas will be included over time. Although we have chosen to write this book on the future of telecommunications policy and regulation, we focus on broadband service because it is both the technology and metaphor for a new digital age of telecommunications that is based on an “Internet protocol” (IP). IP-based systems allow the convergence of what were once entirely separate media—voice over telephone wires, television over the air (technically, the radio-magnetic spectrum) or through cable, and data through the Internet. The FCC has historically regulated each of these media in a different manner. The central thesis of this book is that the new digital IP world calls for...