China, Fiber, Fracas

Via Dave Burstein comes the news that China is adding 2-3 million people to online connections a month. I’ve heard elsewhere that China plans to have 300 million of its citizens connected to fiber (FTTH, or fiber to the home) by 2015. As one of my colleagues quipped via email, “They must have the special access problem solved.” (Jim Crowe of Level 3 has a good piece re control of backhaul/special access by AT&T and VZ, and the cable cos are also in this business.)  One way the country is doing this is by bringing major antitrust actions against its dominant communications providers. Yes, actual lawsuits – even though the country owns the telcos involved. 

Low-priced FTTH access, the global standard for communications, seems very far out of reach here in the US given the current political context. Tom Friedman’s column yesterday is packed with disbelief about how reasonable people are in Australia and New Zealand. Of course the state has a role in ensuring that all of its citizens have basic utility services that are necessary for its people to thrive. Democracies know this, and authoritarian states like China see opportunities for economic growth that will come from connecting its citizens.

Now, China isn’t the model for a good society, particularly as crackdowns there continue to worsen. There are plenty of other countries to point to, though: Benoit Felten’s group, Diffraction Analysis, published a World Fiber report this week (free with registration) that outlines fiber growth elsewhere.

What are we doing here in the US about ensuring that every citizen has communications access that meets the global standard? Well, soon the DC Circuit will likely rule that the FCC’s “once more with feeling” theory of jurisdiction over high-speed Internet access doesn’t hold water. That could be fixed in the future by a simple re-labeling of high-speed Internet access as a telecommunications service, but there’s a shadow on the field: The House Republicans have managed to pass a bill that would make it just about impossible for the FCC to act effectively in the future. If the DC Circuit rules as expected, and the House Rs manage to attach that same bill to a can’t-turn-down vessel next term, what are we left with? An expert agency that has something – minor – to do with spectrum policy, but whose hands otherwise are tied.

Meanwhile, “Facebook Zero,” the notion that carriers will rate certain traffic as “special” and not subject to usage caps, is gathering steam. An AT&T executive blew it by signaling that the carrier will charge content providers to reach subscribers (he was probably supposed to wait until after the DC Circuit decision); Comcast is nudging gamers and video viewers towards their own version of over-the-top online video; and no one seems to have authority to do anything about any of this.

So: we’re gutting the regulator’s power at the same time that market concentration is growing, gatekeepers are taking advantage of their unconstrained powers, and consumers are getting third-rate access. We’re buying Corollas at Mercedes prices. It’s a silent crisis, and unfortunately the best arguments against this situation come from other countries. Americans still think themselves exceptional.

(cross-posted from the Susan Crawford blog at Susancrawford.net)