Rural broadband subsidy -- what's the rush?

We are poised to give out $16 billion less than a week before election day ... This approach is not thoughtful policy, it’s rush-it-out-the-door electioneering.
FCC Commissioner Jessica Rosenworcel

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The Federal Communications Commission (FCC) has adopted procedures for Phase I of the Rural Digital Opportunity Fund (RDOF) auction, which will award up to $16 billion in support over 10 years for the deployment of fixed broadband networks to homes and businesses in census tracks that are unserved by voice and broadband with download speeds of at least 25 Mbps. Successful bidders in the October reverse auction will have to provide a minimum of 25/3 Mbps up/download speed and the FCC will prioritize low-latency (sub-100 ms) networks when awarding funding. They are prioritizing high speeds and low latency so users will "be able to use tomorrow’s Internet applications as well as today’s."

The FCC considers geostationary satellite providers as high-latency and conventional terrestrial providers as low-latency and last month Ars Technica reported that the FCC planned to classify SpaceX and other low-Earth orbit (LEO) satellite operators as high-latency, saying "the providers haven't proven they can deliver low-latency broadband." However, the FCC order issued on June 11 equivocated a bit, saying the FCC has"serious doubts that any LEO networks will be able to meet the short-form application requirements for bidding in the low-latency tier." (The short-form applications are due by July 15, 2020).

If the goal is to support applications that are in use ten years from now, it seems they should consider technologies that will be available ten years from now and the FCC is well aware of the LEO broadband projects of SpaceX, Amazon, Telesat, and several Chinese companies and the possibility that OneWeb will be resurrected. These efforts may turn out to be market failures, but we have both theoretical and experimental evidence to expect that, if successful, they will be able to deliver sub-100 ms latency.

For example, this simulation predicts latencies well under 100 ms even without the inter-satellite laser links that SpaceX plans to introduce in the future and Elon Musk has also reported low latencies with their initial test satellites.

More recently, Telefónica, a major Internet service provider in Latin America and Europe has completed tests with Telesat. (Telefonica owns the Movistar, O2 and Vivo brands). The test scenarios included high-definition video streaming, video conferencing with teams, remote desktop connection to seamlessly manage a remote computer, a VPN connection without any delay or outages, FTP-encrypted file transfers of 2 GB in both directions, and IPSec tunnel encryption with no reduction in the performance of the link. This was done without TCP acceleration or data compression and hey achieved round-trip latencies of 30-60ms with no packet loss.

What's the rush?

Why not allocate $1.6 billion of the ten-year fund this year and the remainder a year or two later when we will have operational data from one or more LEO satellite ISPs? Doing so might require some bureaucratic adjustment and would complicate the planning and bidding process for potential ISPs, but if we are thinking ten-years in the future, why not consider technology that will quite possibly be important in ten years?

Sadly, the rush is political.

For a start, the FCC Chairman came from Verizon and I bet the terrestrial Internet service providers have contributed to Trump and their senators and lobbied the FCC to classify LEO satellites as high-latency.

Furthermore, three of the five FCC commissioners are Republicans and you can read their statements on the RDOF bidding process here. It turns out that the two Democrats were able to convince one of the Republicans to change the draft ruling to allow for the unlikely possibility that LEO satellites might qualify as low-latency providers as noted above.

However, the Democrats were unable to convince any Republican colleagues to postpone the funding until accurate coverage data could be collected and wrote "dissents in part." Commissioner Geoffrey Starks expressed concern over the decision "to spend such a large portion of the budget -- over such a long term of support -- based on broadband maps that are not accurate" and Commissioner Jessica Rosenworcel wrote a stronger dissent including suggestions for addressing the urban and rural digital divides and pointing out that "We are poised to give out $16 billion less than a week before election day ... This approach is not thoughtful policy, it’s rush-it-out-the-door electioneering."

Republican candidates will rush to take credit for bringing the Internet to millions of their rural constituents. Cunning.