Industries oppose restrictive broadband stimulus funding

The telecommunications and cable industries have a warning for federal regulators preparing to distribute $7.2 billion in economic stimulus grants and loans to promote wider access to high-speed Internet service: Don't take our participation for granted.

That's the subtext of public comments submitted by dominant players, including AT&T and Verizon, and industry groups such as the National Cable and Telecommunications Association and the U.S. Telecom Association. The National Telecommunications and Information Administration, a division of the Commerce Department that will distribute the funds in tandem with USDA's Rural Utilities Service, received about 1,400 comments by Monday's deadline. The FCC is playing an advisory role.

In passing President Obama's economic stimulus package, Congress stipulated that the broadband incentives be conditioned on nondiscriminatory behavior and interconnection rights for competitors. At a minimum, this must involve compliance with the FCC's voluntary guidelines governing network neutrality, the concept of maintaining an accessible Internet. Lawmakers did not define those terms or specify the scope of the requirements, leaving that task to regulators. The agencies will issue detailed guidelines for applicants in the next two to three months, an NTIA spokesman said.

Some firms have signaled that if the restrictions are too onerous, they might pass on the funding, though it remains unclear if they are bluffing to secure favorable conditions. During a conference call today, Clinton-era NTIA chief Larry Irving, an adviser to the Obama campaign and transition team, said the administration recognizes it must balance forward-thinking regulation with "the need to get this money out the door and to get our economy jump-started and our infrastructure built."

In the only round of public comments, several parties emphasized this is not the time for burdensome restrictions. Government incentives "should not be diminished by an onerous requirement going beyond the current application of the commission's broadband policy statement," cautioned the U.S. Telecom Association, whose members include AT&T and Verizon.

The cable association expressed a similar view. "To keep this already quite daunting task on track," AT&T wrote separately, "NTIA and RUS should rely, wherever possible, on existing federal regulatory policy, and they should avoid miring this stimulus program in unresolved long-term policy controversies now pending" before the FCC. The wireless association CTIA urged agencies not to extend the FCC's net neutrality principles to mobile carriers, a position echoed by Verizon. But the watchdog group Free Press countered that Congress specifically asked regulators to bar nondiscriminatory behavior, something the FCC principles do not now prohibit.

Meanwhile, efforts to "map" the availability of broadband service are stoking controversy. The telecom association suggested that regulators not wait for states to complete mapping before doling out the money.

"Timeliness of awarding grants and beginning construction are key elements" of the Recovery Act, it argued, underscoring the need for urgency "given the fragile state of the nation's economy and the fact that millions of Americans lack access to core broadband services."

Parties sparred over the efficacy of Connected Nation, a nonprofit group that partners with states to track broadband availability. In joint comments, four advocacy organizations accused the group of being a corporate front that fails to disclose most of its data and uses inaccurate methods. Connected Nation countered that it has a range of partners, publishes its maps online and takes steps to ensure accuracy.