Governments use new funds, spectrum to pressurise operators

On both sides of the Atlantic, governments are working out how to use stimulus funds and open up new spectrum to boost the broadband economy - and what strings should be attached for the operators that benefit.

US regulator the FCC has opened up for consultation on its rules for allocating the $787 million of grants and loans earmarked for wireless and wireline broadband under the massive economic stimulus program. It is seeking to avoid a situation where marrying the different interests of consumer groups, internet players and telcos ends up enmiring the fund so deeply that grants don't become available until after the recession is over.

The FCC is devising a 'national broadband strategy' to go with the funding, which could have a significant impact on broadband providers. Its task is to determine how tax dollars will be spent on improved internet access, and to update policies that have not kept pace with new technologies and business models.

Acting FCC chairman Michael Copps says this is 'the biggest responsibility given to the FCC since the Telecom Act of 1996' (not a good analogy, given the gaping holes in that legislation).

Among the possible actions that would worry the operators are open access and mandated sharing of any infrastructure that is built with government funding. The latter is already being opposed, pre-emptively, by the large carriers, which are saying they may pass on funds if the conditions are too harsh.

Another sticky issue will be how far network owners are allowed to cap usage or bar certain applications to guard against bandwidth hogs, or to prevent damage to their own revenues, as highlighted by the mobile Skype wars. The FCC's plan is to be published in February 2010 and will be overseen by Julius Genachowski, the chairman in waiting.

Across the pond, European telecoms commissioner Viviane Reding said Europe must have a firm framework in place by the fall, for using the 'digital dividend' spectrum to support universal broadband plans.

She believes the spectrum, which will be freed up by the switch from analogue to digital TV, will be essential for stimulating growth and competition in European telecoms, but this will require 'ambitious decisions from policy makers at European and at national level. The time to act is now'.

Reding, never shy of implied threats of European Commission mandates should national regulators or operators fail to act quickly, added: 'By autumn of this year, Europe must have paved the way for an efficient use of the digital dividend, and the European Commission is prepared to make the necessary recommendations for this.'

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