Broadband Cable Association of Pennsylvania


March 6, 2013

Comcast Corp. says 5,700 low-income families in the Philadelphia area are now participating in a discounted Internet service the cable giant agreed to offer as part of its merger with NBCUniversal. Throughout the nation, 150,000 families have gone online with the program, Comcast said Tuesday. The service costs $9.95 a month, and participants can buy computers for $150. Comcast says 15,000 customers have bought them. Internet Essentials is available to parents with children who qualify for the federal free-lunch program, though families with past-due Comcast bills may not participate.

Comcast says the program, launched in August 2011, can help close the "digital divide," the gap between low-income children who do not have access to the Internet and middle-class and well-off children who do. Comcast is the nation's largest residential-Internet provider, with about 19 million broadband customers. A separate initiative, Connect2Compete, says it will launch nationally on March 21. Comcast, Time Warner Cable, Bright House Networks, and nonprofit groups are part of the consortium. Julius Genachowski, chairman of the Federal Communications Commission, which regulates cable companies, has made extending Internet access to those who do not have it a policy goal. Zach Leverenz, Connect2Compete's chief executive officer, said Tuesday that he hoped to have one million families enrolled in the discounted Internet service in its first year.

In Internet Essentials' early stages, Philadelphia was one of the laggards among Comcast's TV markets in adopting the program. Philadelphia still trails other major cities in the number of Internet Essentials customers but has improved, Comcast executive vice president David Cohen said in a conference call. Chicago has 15,500 Internet Essentials customers, the most. The Miami area is second with 14,000, and Atlanta is third with 11,000. To expand the potential market, Comcast said home-schooled, private- and parochial-school students can participate, adding an estimated 300,000 prospective customers. The company also will introduce prepaid Internet Essentials cards so that charities can buy them and distribute them to low-income families. - Philadelphia Inquirer; more in the Inquirer, Pittsburgh Post-Gazette and St. Paul (MN) Pioneer Press

As Washington continues to wrangle over raising revenue and cutting spending, let's not forget a crucial third element for reining in the deficit: economic growth. To sustain long-term economic health, America needs growth engines, areas of the economy that hold real promise of major expansion. Few sectors have more job-creating innovation potential than broadband, particularly mobile broadband. Private-sector innovation in mobile broadband has been extraordinary. But maintaining the creative momentum in wireless networks, devices and apps will need an equally innovative wireless policy, or jobs and growth will be left on the table.

America operates today from a strong foundation. Over the past few years, after trailing Europe and Asia in mobile infrastructure and innovation, the U.S. has regained global leadership in mobile technology. America leads the world in scale deployment of 4G LTE, mobile's next generation, and there are as many 4G subscribers in the U.S. as in the rest of the world combined. Private investment in mobile infrastructure-nearly $30 billion last year and nearly $35 billion projected this year-is more than 50% higher than in Europe, and up more than 60% since 2009. American-made operating systems now power more than 90% of the world's smartphones sold, up from 25% four years ago. But this rapid progress raises significant challenges.

Smartphones, tablets and other wireless devices all rely on spectrum-the airwaves that transmit bits of information to and from these mobile marvels. Think of it as the country's invisible infrastructure. Spectrum is finite, and the demand for airwaves being created by data-hungry, Internet-connected devices is on pace to exceed supply. How significant is the spike in demand? Today's smartphones generate 50 times more mobile traffic than a traditional cellphone. For tablets, it's 120 times more traffic. As a result, American wireless networks are running at the highest utilization rate of any in the world. Starting with the development of the Federal Communications Commission's National Broadband Plan in 2009, developing innovative policies to free up spectrum for broadband has been one of the FCC's highest priorities.

Math, physics and history dictated that this was the right course. The U.S. has long led the world in spectrum-policy innovation, and these forward-looking policies led to significant job creation and economic growth. The U.S. became the first country in the world to use auctions to allocate spectrum when the FCC pioneered the practice in the 1990s. Since then, the FCC has conducted 80 auctions, granting more than 30,000 licenses and raising more than $50 billion for the Treasury. Economists estimate the value created by FCC spectrum auctions as approximately 10 times that number, or $500 billion.

A second major policy innovation: unlicensed spectrum. In the 1980s, the FCC became the world's first agency to make spectrum available for unlicensed use, meaning anyone can use it as long as basic rules are followed to prevent interference. U.S. innovators have used this open platform to invent powerful technologies like Wi-Fi and Bluetooth, which have generated billions of dollars in economic value. Three new spectrum policy hold big potential. First, incentive auctions. A key recommendation of the National Broadband Plan, these will harness market forces to repurpose high-quality, broadcast-television spectrum for broadband. The mechanism is a two-sided auction through which TV broadcasters will receive payments for voluntarily relinquishing spectrum in particular markets, the agency will repack spectrum into contiguous blocks suitable for broadband, and wireless carriers will bid for those licenses. Following congressional authorization last year, the FCC is working on implementing the plan so that next year it can hold the world's first incentive auction.

Second, a new generation of unlicensed spectrum. In 2010, the FCC freed up the most high-quality unlicensed spectrum in 25 years ("white space" between TV channels), making varying amounts available in communities throughout the country for uses including Super Wi-Fi and machine-to-machine communications. In the spectrum that will be freed up as part of the incentive auction, the FCC proposes allowing unlicensed use of "guard bands" that are required for interference protection between licensed bands. This high-quality unlicensed spectrum, available for the first time everywhere in the country on common frequencies, could be an extraordinary new platform for innovators to create new networks and applications.

Third, spectrum sharing. The FCC proposed an idea, endorsed by the White House's panel of science and technology advisers, to use database technology to enable spectrum sharing between commercial broadband, military and other government systems. In December, the FCC launched a formal proceeding to do this in a band currently used by naval radar systems. By focusing the band on small-cell technologies that mobile broadband providers are increasingly embracing, a large chunk of additional spectrum could be online for commercial use by 2015.

Each of these proposals has been contentious and will require hard work to implement. But inaction will undermine U.S. competitiveness. Keeping discussions focused on solving problems, and on facts and data, will best ensure that policies pioneered in the U.S. are first implemented in the U.S.-so that innovation, private investment and jobs follow. - Wall Street Journal op-ed from FCC Chairman Julius Genachowski