FCC Releases The Smoke & Mirrors Internet-Broadband Connections Report

Click for the FCC Numbers-Only Version of this Exhibit.

As I stare at the various pie charts and exhibits in the FCC’s latest report on broadband in America, “Internet Access Services: Status as of June 30, 2017”, published November 2018, only one thing comes to mind: Congress needs to investigate how this smoke and mirrors data is being used to create harmful public policies.

Back in March, 2011, I wrote about the FCC’s highly inaccurate National Broadband Map Database, where the companies listed did not offer service at my address or at the speeds listed.

Seven years later, and trying to reverse-engineer the number of broadband services, especially the accounting of the “Fiber to the Premises”, FTTP, here are a few startling long-term issues and new discoveries. In the industry, these are some of the dirty, little secrets.

Quoting the FCC, there are various caveats.

§ “Who Files What?
· “All facilities-based broadband providers are required to file data with the FCC twice a year (Form 477) on where they offer Internet access service at speeds exceeding 200 kbps in at least one direction.
· “Fixed providers file lists of census blocks in which they can or do offer service to at least one location, with additional information about the service.

Please notice the words and phrases: “census blocks”, “200Kbps in at least one direction”, “they can” and “at least one location”. We will address them in a moment.

How Big Is One Census Block?

A census block is sort of like the area of a postal zip code. And it is directly tied to a specific geography with people living and working at specific locations. Sounds obvious until you examine how they count these locations.

According to Current 360

“Block groups generally contain between 600 and 3,000 people, with an optimum size of 1,500 people… Each census tract contains at least one block group, and block groups are uniquely numbered within the census tract. A block group is the smallest geographical unit for which the census publishes sample data.”

Smoke & Mirror Competition

The FCC and phone companies claim that there is competition and yet, this next FCC caveat about this data tells us that while the database may show a competitor, you, the customer, may never be able to get service from them.

The FCC writes:

Block-Level Deployment and Competition A provider that reports deployment of a particular technology and bandwidth in a particular census block may not necessarily offer that particular service everywhere in the census block. Accordingly, a list of providers deployed in a census block does not necessarily reflect the number of choices available to any particular household or business location in that block, and the number of such providers in the census block does not purport to measure competition.”

The Census Block Black Hole has been previously discussed. In fact, the Government Agency, NTIA, has been examining “Quality and Accuracy of Broadband Availability Data” and a number of groups, including Public Knowledge, Next Century Cities and X-Lab, have filed comments.

When we put all of this together, then, exactly how much of the report is bogus? You decide.

Let’s start with review of what these previous FCC paragraphs mean:

§ The FCC’s data is based on something called a ‘Census Block’, sort of like the area in a zip code.

§ The FCC’s data is counting a service that may be available to only one location in the census block.

§ The FCC claims that a customer may not be able to get a competitive service even if the company is doing business in that census block.

§ While the FCC’s data has caveats, the FCC hasn’t made it clear to those quoting the reports that “the number of such providers in the census block does not purport to measure competition”.

§ America’s broadband speed starts at 200Kbps in 1 direction; that’s 1/5 of 1 Mbps. This should be a red flag. This definition started to be used in 1998 to inflate the number of broadband connections. In the Digital Age this is the equivalent of two tin-cans-and-string.

There are a host of other data points of interest from this report that we will address:

§ The FCC’s specific data has no reality to what is supplied in the Verizon, AT&T or Centurylink annual reports for DSL or fiber optic services.

§ While the FCC lists 13 million fiber optic lines, the charts show no Gig speeds, only 3.5 million who have a fiber optic service that can handle over 100 Mbps.

§ Conversely, there are over 680,000 lines of fiber that have speeds of under 10 Mbps.

§ The satellite companies are not bringing in very high speed broadband, with none showing speeds of over 25 Mbps.

§ The cable companies now control the wired residential broadband markets, and they have a sweetheart deal with telcos which, in essence, says — You take wireless; we’ll keep wired broadband and cable; we split the market in a few territories.

§ This means that the overwhelming majority of customers have one high speed broadband provider — the cable company — or nothing.

To put all this into perspective, if you live in a small town, and it is one census block (or a few), then if just one location has a service, everyone is counted as having that service, but may not be able to get it. And, since there are ‘satellite’ and wireless services covering everyone, etc., then everyone has competition, even if they can’t get reception or use the broadband service. And the FCC is helping to ‘retire’ the copper networks instead of upgrading these networks. Ironically, no one wants to hold the incumbent phone company, the state-based utility, culpable for their failure to properly maintain and upgrade the critical communications infrastructure in our towns — the wires under our feet or on the poles.

The Minimum Speed Is Based on a 20 Year Old Definition; 200 Kbps in 1 Direction.

It is 2018 and the wondrous wireless 5G and fiber are supposed to be capable of delivering 1Gbps, which is 1000 Mbps; 1 Mbps equals 1000 Kbps. And yet, the FCC’s report doesn’t supply any number for any services using this speed — 1Gbps or higher.

In 1993, the Verizon New Jersey “Opportunity Plan” claimed it would be delivering 45 Mbps in both directions and have 100% of their territory, starting in 1996, completed by 2010. This is from the 1993 NJ state regulations and this speed was used in other state agreements.

We filed with the FCC about using this emasculated speed of 200 Kbps in 1998–20 years ago. Ironically, it was then a Democratic FCC that allowed this 200 Kbps to be used, mainly because Verizon et al. never deployed the fiber optic services they had committed to roll out and the FCC wanted to inflate the number of broadband connections, even back then.

Some of the Report Details: Phantom Fiber, Phantom Competition and Puffery.

Where’s the Fiber?

In the US, there’s more fiber in your cereal than in the ground reaching homes and offices. Try reverse-engineering some of these numbers and you realize that they are created to distort public policy and not to display any truth in statistics

Let’s go through the number of Fiber to the Premises, FTTP, locations in the US.

Returning to the first chart, this simpler version details that in 2017 the FCC claimed there were 13 million FTTP fiber to the home lines. But this number appears to have multiple issues.

Verizon’s Claims

Checking Verizon Communications 2017 Annual Report (as Verizon is the largest FTTP provider, we assume), there has been no serious growth in broadband subscribers for years. The numbers are mostly flat for video and the internet service — over the last 3 years.

But something is off. Fran Shammo, the former-Verizon EVP, stated at the Nomura Global Media Summit, May 30, 2013:

“We have 18 million homes passed at this point. We have about 5 million plus customers…”

Besides stopping the FiOS deployments in 2010, (with exceptions), how could there be so little growth in services?

And if Verizon has only 5.8 million subscribers now, then who is providing all of the other fiber lines? Frontier purchased Verizon’s territories in various states which had FiOS, which increases this number a bit.

AT&T’s Claims

AT&T and Google do not supply the number of actual ‘lines in service’ for fiber optics, that we could find.

AT&T claims it has passed 7 million locations with fiber by the end of 2017, and yet their Annual Report supplies no numbers of actual fiber optic lines in use.

“Locations reached by the end of 2017, against a goal to expand all-fiber internet access capability to at least 12.5 million customer locations by mid-2019: 7 Million+”

Also, note that these are ‘locations’ that include business customers and yet there are no details about AT&T’s fiber optic services in use in the US.

And these are ‘passed’ locations and the FCC has allowed this to mean “within 1000 feet” as opposed to being able to actually connect the customer without having to run wires for a few blocks.

Other Providers

Google’s numbers are also hidden. In 2016, the company stated it was slowing down its deployment plans.

There are a host of other companies, municipalities, etc. out there who have decided to not wait for an incumbent telecommunication company to do the work. But there is no major installed base we could find with millions of fiber optic customers.

And even if these cities and towns have providers that are delivering 13 million fiber optic lines, the implications are not good. It is the end of 2018 and Verizon et al. had 25 years to do proper upgrades of the US — and didn’t do them. In fact, the companies have also been losing/attempting to get rid of DSL customers.

ADSL Is Everywhere and No Where

ADSL is a broadband service that uses the existing copper wire networks. According to the FCC, there were 25.5 million ADSL services; but where are they?

AT&T and Verizon have been continuously losing/disconnecting DSL lines. AT&T only listed 888,000 lines in the 2017 Annual report; Verizon had 1.1 million lines, and Centurylink had 5.7 million ‘broadband’ connections, but this includes “IP” and probably special access (sometimes called “Business Data Services”) as ‘broadband’; they don’t give DSL as a separate category.

Counting Caveats

And the caveats continue about the accounting presented, which includes DSL. The FCC writes that AT&T’s U-verse is considered ADSL (fiber-to-the-node) in this analysis yet the ‘special access’ lines that are ‘copper’, such as T1/DS3, are in other reports.

“In the Form 477 data collection, aDSL-based services delivered over fiber-to-the-node architecture are reported in the aDSL category. The other wireline category comprises T1/DS1, T3/DS3, and other copper-based connections, not elsewhere categorized, that deliver Internet access service at the end-user.”

AT&T’s U-Verse is a copper-to-the-home service and at this point it is being dismantled to move to wireless and the video to DirecTV; or worse, the plan is to not build infrastructure and offer ‘over the top services’.

NOTE: AT&T has also created an “IP Broadband” category, which appears to be wireless broadband. And Verizon, AT&T and the other companies are combining all of their services into new categories, which adds a lot more smoke and dark shadows lurking in the mirrors.

Cable Dominates; Satellite Isn’t Even Breathing Broadband.

  • The overwhelming majority of wireline broadband is now being handled by the cable companies. According to the FCC, there are 64 million broadband connections, with 26 million doing over 100 Mbps.
  • Cable companies have clearly handed over the wireless business to AT&T and Verizon so that they could split the market and they would bring wired broadband at higher speeds.
  • In fact, some of the cable companies are reselling Verizon Wireless, not to mention that they sold much of the wireless spectrum holdings to Verizon.
  • Satellite Services, on the other hand, aren’t a serious high speed competitor as there are no services listed above 25 Mbps at this time.

But, the FCC will throw this up as if there was serious competition.

“Satellite service providers report offering Internet access at bandwidths of at least 10 Mbps downstream and 1 Mbps upstream in 99.8% of developed census blocks”

Claims of Competition vs Actual Competition; Useless Data to Hide the Bad News.

All tied together, with the FCC’s help, there will be one high speed provider in most markets — the cable-company, with no serious competition, and there will be the continuing abandonment of wireline rural areas overall, helped by the FCC’s failed policies. This plan is to push these rural areas to wireless — because it makes the companies more money; it is not about the customer or cities or the states’ economic growth, etc.

Broadband Scandal and this Report

The kicker to the fiber optic story, however, is that 5G, a mythical wireless service, is supposed to solve everything. But, they are based on ‘small cells’ with a range of 1–2 city blocks and requires a fiber optic wire attached to the small cell site to work.

Who is really going to pay for the fiber used in the phantom 5G wireless networks?

I leave you with this sobering thought about our broadband, internet, cable, wireless, phone — our communications future — and all of the hype surrounding wireless 5G.

From 1991–1996, (and pushed by the Clinton-Gore ticket), the “Information Superhighway” hype, makes the noise around 5G seem like a whisper.

All of the current incumbent wireline phone companies — AT&T, Verizon and CenturyLink, in their previous incarnations, made claims that they would rewire all of America by 2010; about ½ of it would be done by the year 2000.

And all of them filed both at the FCC in something called ‘video-dialtone’ deployments to wire cities with fiber optics by replacing the existing copper wires, and they filed in every state, such as New Jersey, to wire some, most or all of the state — even the schools, libraries and hospitals.

State laws were changed to charge customers for these upgrades — multiple times. And once the companies got what they asked for, they never showed up.

Again, the current 5G hype is mild compared to ‘fiber optic feeding frenzy’ — and all of the things it would bring to America.

This FCC report shows just how far we have fallen. In the next article I’ll document it more.