Welcome, Chairman-to-be Genachowski; Hope you brought your waders

By Craig Settles

And maybe you should bring a couple of shovels, too. The manure's already pretty deep as we work toward a meaningful national broadband strategy to transform local economies, healthcare, education and other key areas that lead to widespread vs. concentrated prosperity. Take AWS-3, for example.   

It was rough standing downwind when the telecom industry declared recently that the AWS-3 idea your predecessor was promoting, with 25 percent of the spectrum provided free, would fail for the same reason free municipal wireless failed. Don't believe it! The incumbents are mucking up the water with a claim that demonstrates they have neither marketing savvy nor fully understand the needs of the market. (That's the kind interpretation.)   

The free requirement has become the tail that's wagging the dog in this discussion. A creative marketing mind that has thoroughly assessed what various parts of America can do with truly fast broadband can take former FCC Chairman Martin's idea and run to the bank with it.

Here's how:

First, know the history of muni wireless. The muni wireless movement was born out of the failures of market forces--aided by ridiculous legislation--to provide services that potential customers (including local governments) were willing to pay for. Unfortunately, this movement was derailed by silly requests for proposals for "free" muni wireless that required vendors to build the physical network and provide all or many access services at no charge.

However, in Mr. Martin's proposal, only 25 percent of the spectrum must be available for free. If Bob & Bobbie's Broadband Emporium wins the bid, they still have 75 percent of the spectrum to sell, plus they can sell the network infrastructure.  

B&B can go into rural, urban or other communities and suggest to local governments that they partner with appropriate local businesses while B&B teams with appropriate technology partners to sell them an infrastructure/applications/spectrum package for X dollars. B&B will help them identify economic, government and other needs that justify the investment, plus throw in 25 percent of the access for those in financial need. What, short on funds? Let's see how we can tap into some of this Federal stimulus money.

As the new FCC chairman, you will likely want to make a break with your predecessor, but let's not toss out the baby with the bath water, Mr. Genachowski. This business opportunity for AWS-3 indeed exists because a strong need exists.
 
I'm sure you value the cardinal rule for successfully deploying technology: do thorough needs analysis before committing to a technology to make sure your people will buy what your vendors are selling. I recently surveyed economic development professionals nationwide, and interviewed at length people who led or facilitated broadband projects that are making an economic impact.

Research results indicate a willingness to buy the type of package I described: super fast access, technology services and applications, a network and some strategy development, all from a viable source, plus the prospect of grant money if needed. Providing such a package just for the economic development projects listed in this report would keep B&B working nonstop for a few years.

However, you should make a couple of important changes in other FCC requirements regarding AWS-3 that adversely impact the business model.

First, forget about covering 95 percent of the country in 10 years. Whatever technology you start building in California is going to be obsolete by the time you get to Maine. Actually, in 10 years whoever wins the bid might get as far as the Mississippi River. What's more, not everyone lacks sufficient broadband. Put AWS-3 where constituents, not incumbent-funded entities, determine a need.

Second, change the assumption that we need a single physical network nationwide similar to Interstate 95 that runs through a bunch of states. When you gather feedback from a cross section of America, it becomes evident that one network won't fit all. The right solution is different combinations of technologies and services for different communities.

Following that logic, consider allowing several entities to walk away from the auction with spectrum. A platoon of B&Bs can address the vast U.S. geography and diversity of community needs faster and more efficiently than one winner. M2Z Networks may not be happy, but hey, spread the wealth. New York State may have avoided their network project collapse last week if they had several companies building community networks rather than one company trying to build one massive infrastructure. 

Since it appears folks on Capitol Hill are pushing grants targeted to community projects, the business viability of one or several AWS-3 winners looks better every day. Keep up the momentum. Use a little good will and quiet persuasion to get legislation passed that frees local governments to partner with, or even create their own, B&Bs as appropriate to meet their constituents' needs.  

Also, consider this important side note: Open the door to more direct feedback from the people who need the technology. If change.gov can facilitate 8,200 meetings nationwide by a range of constituents to discuss healthcare reform, do the same for broadband. This is how you get a stimulus plan that produces short-term and long-term economic benefits. Otherwise, we risk having the broadband change we need become DOA--and taxpayer dollars will line the grave.

Craig Settles is an industry analyst and workshop leader who helps organizations understand the benefits of broadband and mobile technology. Chek out his website at www.successful.com.

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