2 qitcom 2012 - stagg newman (next gen broadband)
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Lessons from Connecting America:The National Broadband PlanPerspectivesfor the MidEastTRANSCRIPT
Lessons from Connecting America:The National Broadband Plan
Perspectives for the MidEast
Dr. Stagg NewmanMcKinsey AdvisorQITCOM QATAR 2012March 5, 2012
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Congress’s charge in the Recovery Act led to the creation of the National Broadband Plan
Congress said that the plan should:
• “Ensure that all people of ______ have access to broadband capability and establish benchmarks for meeting that goal.”
• “[I]nclude . . . a detailed strategy for achieving affordability . . . and maximum utilization of broadband infrastructure and service”
• “[I]nclude . . . an evaluation of the status of deployment of broadband service”
• “[I]nclude . . . a plan for use of broadband . . . in advancing consumer welfare, civic participation, public safety and homeland security, community development, health care delivery, energy independence and efficiency, education, worker training, private sector investment, entrepreneurial activity, job creation and economic growth, and other national purposes.”
Goals
A plan to encourage private investment and
innovation (w/ the exception of
subsidies for rural America)
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Goals of the National Broadband Plan
• Goal No. 1: At least 100 million U.S. homes should have affordable access to actual download speeds of at least 100 megabits per second and actual upload speeds of at least 50 megabits per second.
• Goal No. 2: The United States should lead the world in mobile innovation, with the fastest and most extensive wireless networks of any nation.
• Goal No. 3: Every American should have affordable access to robust broadband service and the means and skills to subscribe if they so choose.
• Goal No. 4: Every American community should have affordable access to service of at least 1 gigabit per second to anchor institutions such as schools, hospitals and government buildings.
• Goal No. 5: To ensure the safety of the American people, every first responder should have access to a nationwide, wireless, interoperable BB public safety network.
• Goal No. 6: To ensure that America leads in the clean energy economy, every American should be able to use broadband to track and manage their real-time energy consumption by 2020.
Goals
Countries need pragmatic aspirational and achievable goals that reflect their people, infrastructure, and government
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What the NBP is? What it is NOT? ….
What the National Broadband Plan is:
▪ A fact driven analysis of the state of broadband in the U.S. and the gaps between aspiration and reality
▪ A set of recommendations (>>100) for the FCC, the Administration and Congress
What the National Broadband Plan is not:
▪ A self-actualizing plan.
▪ A new regulatory structure for the communications industry
Goals
Most recommendations have not been implement, many due
to political stalemate…Major breakthrough last month
on Spectrum Policy
Nevertheless, a wealth of valuable analysis is available including the entire plan, supporting analysis, public input, workshops, etc at
www.broadband.gov
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Gaps in the broadband ecosystem (circa 2010)
Availability gap
Adoption gap
Digital skills gap
National purposes gap
• Fourteen million Americans do not have access to broadband infrastructure that can support today’s and tomorrow’s applications
(Fixed wireless access w/ LTE is best way to close gap)
• 93 million Americans do not have broadband at home
• Many Americans lack digital skills, even as many job openings are posted exclusively online
• The U.S. ranks in the bottom half of comparable countries on nearly every metric used to measure the adoption of health information technology
• Most of the U.S. electric grid is not connected to broadband
• First responders are using outmoded spectrally inefficient narrowband communications technology that denies them access to broadband applications for public safety and health.
Goals
In all but perhaps the most advanced Asian countries, the gaps will be similar while the specifics differ
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Several gaps may be hampering innovation, investment, and competition
Gaps Issues• Spectrum for mobile competitors is likely to enhance mobile
competition• More spectrum may also allow wireless technologies to
serve as closer substitutes to fixed broadband providers
Need for spectrum
• Consumers often do not know true performance of services purchased
• Consumers generally unaware how their own actions, along with internet characteristics, can affect performance
Lack of transparency for consumers
Patchwork of wholesale regulations
• Current data (commission and external) lack detail to make granular competition policy decisions
• Existing data collection does not allow comparative evaluation
Lack of detailed data to inform competition policy
Innovation, Investment, and Competition
• Well functioning wholesale markets can help foster retail competition
• Today's wholesale access policies were developed without reference to a consistent analytical framework
Policy gaps will likely be very country specific. Need for more spectrum for broadband wireless is universal.
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Trends in demand and supply suggest a looming spectrum gap
Moreover with sufficient spectrum wireless BB is the best way to serve “unserved” areas.
Need to transform spectrum policy to
meet wireless broadband demands
•300-500 MHz more spectrum for mobile broadband•More spectrum for unlicensed and new paradigms•Incentive auctions•Wider blocks of spectrum
Spectrum
Forecasted mobile data traffic in North America
Mobile broadband spectrum pipeline
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Policy changes needed for a range of issues
Gaps Issues
• Current allocation and utilization data is largely unattainable and often esoteric
• FCC needs at its disposal multiple tools for reallocating underutilized spectrum to next-generation users
Spectrum
• Wireless broadband growth is causing network strain that will intensify with next-generation technologies
• Spectrum can take years to reclaim• Growing need for expensive backhaul services, including
microwave
• Access lacking in terms of capacity, flexibility and affordability
• Opportunistic access to spectrum is limited to certain bands
• Demand for unlicensed spectrum among key stakeholders
• There is no framework for identifying future spectrum bands and needs
• Coordination of multiple domestic and international stakeholders
Policy scope too bounded
Access models limited
Suboptimal backhaul deployment
Insufficient capacity for broadband
Few spectrum reallocation tools
Lack of transparency in allocation and utilization
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Government regulation and policy affects deployment decisions.
Gaps Issues• Pole rental rates affect cost of broadband in rural areas—up
to 20% of a rural subscriber’s bill• “Make ready” charges for poles can constitute >10% of cost
of deployment• Multiple sets of sometimes inconsistent rules and policies
Too costly to access poles and other infrastructure
• Disputes over poles and ROW access linger for months, years; many states have better policies and timelines
• Near-constant litigation on scope of privately-owned pole, duct and conduit access rights
Time to access and resolve disputes
• Data on infrastructure availability not uniformly kept or updated
• Processes and fees for use of public rights-of-way and gov’t facilities for broadband facilities disparate and varied
Lack of information and data on infrastructure
• Different rates for pole attachments based on category of service offered affects upgrade and service decisions
• Failure to consider broadband as part of public works projects at planning stage can drive up costs substantially
Policies affect deployment decisions
Infrastructure
Enlightened policy can lower input costs and speed time to market.
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Making broadband available
Create a new Connect America
Fund
Intercarrier compensation
reform
Create a new Mobility Fund
Support universal availability of broadband and high-quality voice grade service with at least 4 Mbps actual download/1 Mbps upload speedsDevelop expedited process to target funding to unserved areas, shifting funds from legacy programsProvide support where there is no private sector business case to offer affordable serviceEncourage innovation with a technology- and provider-neutral program
Target funding to states that are significantly lagging national average for 3G coverage
Eliminate inefficient and irrational economic behaviorEncourage transition to IP-to-IP interconnectionStaged transition away from per minute rates to allow companies and investors to prepareProvide opportunity for adequate cost recovery
Inclusion
Availability policy must be driven by deep analysis of a country’s people
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Adoption by demographic & socioeconomic segment –in-depth surveying
49
59
69
35
64
7475
50
68
93
84
59
40
86
77
55
24
90
80
70
60
50
40
30
20
100%
10
0Hispanic*BlackWhite65+50-6430-4918-29RuralNon-
rural$40K
to $75K
$20K to
$40k
Less than $20K
College+
Some college
High School
Less than High
School
$75K +
*Hispanics includes both English and Spanish speaking Hispanics;
Percent of American adults
*Hispanics includes both English and Spanish speaking Hispanics;
Percent of American adults
Adoption
Cost – 36%▪ 15% - monthly fee for service▪ 10% - cannot afford a computer▪ 9% -- activation fee/contractDigital literacy – 22%▪ 12% -- lack of comfort with computers▪ 10% -- hazards of online life
Key reasons for non-adoption
Relevance – 19%▪ 5% -- content with dial-up▪ 5% -- internet is a waste of time ▪ 4% -- Nothing to see ▪ 4% -- Don’t use it muchRemaining reasons:▪ 15% -- other or combination of several reasons▪ 5% -- not available where they live▪ 3% -- can use the internet all they want at work
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Framework for recommendations – an example
Launch a three-part National Digital Literacy Program
Improve focus on evaluation, measurement, best practices, and state-level initiatives
Focus on “relevance” through public/private partnerships
Expand low income universal service support to broadband (see USF)
Adoption
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2
3
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Accelerate efforts among low-adopting groups facing significant social or physical barriers
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The national purposes mandate
“a plan for use of broadband infrastructure and services in:
▪ advancing consumer welfare▪ civic participation▪ public safety and homeland security▪ community development▪ health care delivery▪ energy independence and efficiency▪ education▪ worker training▪ private sector investment▪ entrepreneurial activity▪ job creation and economic growth▪ and other national purposes.”
Healthcare
Energy and the environment
Government performance and civic engagement
Public safety and homeland security
Economic opportunity
Education
American Recovery and Reinvestment Act, §6001(k)(2)(D):
National Purposes
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Gaps persist in fully utilizing broadband for public safety and homeland security purposes
Gaps Issues
Public Safety
No nationwide public safety network
No nationwide, interoperable broadband wireless network that is ubiquitous, redundant, and resilientFew public safety agencies have access to commercial wireless mobile broadbandCommercial broadband does not support public safety requirements and is not cost effective
Outmoded 9-1-1 system 9-1-1 services utilize varied legacy communications networksFew public safety agencies have access to broadband services to support next-generation 9-1-1
Outmoded alerting system Current distribution technology limits amount of audio/visual to Americans over broadcast channelsFEMA has taken steps to develop IPAWS but clear implementation milestones are needed
Critical infrastructure vulnerabilities
Companies reported $265M+ in cyber crime-related lossesCommunications providers subject to frequent attacks on critical IP-based infrastructureInsufficient incentives and safeguards for security of critical communications assets
Source: Internet Crime Complaint Center
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Enables high coverage communications, resilient coverage and guaranteed access in a cost effective manner leveraging commercial assets
Provides access to additional capacity during emergencies, as well as increased network resiliency
For exceptional times and places when PS & commercial infrastructure is insufficient (e.g. wilderness) or has been destroyed
Solution for Reliable, High Coverage Mission Critical Voice, Data, & Video 4G Services
Coverage deep inside large buildings and capacity for high pedestrian density (e.g., shopping centers) can only be provided by in-building solutions
Public Safety Broadband Wireless Network
Public Safety’s Dedicated RAN using Commercial cell sites and core
Commercial Wireless Networks
Public Safety Roaming and Priority Access
Deployable Equipment Caches
Deployed and controlled by PS
DAS and Picocell Systems
In-Building/Underground Coverage in PS Spectrum
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Innovative public private partnership can lower the costs of a nationwide broadband public network from >>$20 Billion to < $10 Billion
Public Safety
Feb. 2012: Congress passes enabling legislation for BB PS network with public/private partnership
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Lesson for all upon reflection 2 years later
• Realizing the public good from BB requires addressing a complex set of factors that include availability, adoption, and national purposes that are country specific and political.
• Wireless will drive the next “Big Wave” of innovations, provide exciting applications and services and be the most capex efficient way to provide broadband to “unserved” people and areas but …
• Spectrum policy must be dramatically changed to realize this potential:
More licensed spectrum and More unlicensed
Innovative approaches (e.g. incentive auctions) to create more efficient usage
Wider blocks of spectrum
• Understanding the barriers and solutions to greater adoption and requires deep analysis of both users and non-users of broadband
• Innovative public private partnerships provide more capex efficient methods to meet national purposes (e.g. BB Public Safety).
Implications for all countries