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Broadband Bytes, June Issue 1

This edition of Broadband Bytes includes ISP discount plans, USF instead of ACP?, ISP joins in training the next generation of techs, asset-backed securities/Frontier, AT&T Wins and losses: fiber satisfaction survey and carrier of last resort, rip-and-replace funds, NTCA BEAD tips, FCC LOC Review, Charter RDOF pull back, replacing copper with fiber and how one state approaches BEAD decision process.1. Internet providers agree to continue discounted plans through the end of 2024 as federal subsidies end. More than a dozen internet service providers have agreed to continue offering discounted internet plans to low-income households through the end of 2024, as the federal program subsidizing the discounts comes to an end. AT&T, Comcast, Cox, Spectrum, Verizon and nine other providers will continue offering their $30 or less plans to those currently enrolled in the Affordable Connectivity Program (ACP) and other eligible households. Other participating providers include Allo Fiber, Altafiber (and Hawaiian Telcom), Astound Broadband, IdeaTek, Mediacom, MLGC, Optimum, Starry and Vermont Telephone Company. Read more.2. Could the ACP push the Feds to resolve festering USF issues? For years, the federal government has avoided any attempt to resolve a long-standing problem: how to sustain funding for the Universal Service program. But perhaps that could change now that the lack of funding for the Affordable Connectivity Program (ACP) has gained substantial mindshare with the American public. Some stakeholders believe both problems can be solved by funding the ACP through the Universal Service Fund (USF) and expanding the types of entities that are required to pay to support the program. Read more.3. ISP in Washington is assisting a nearby technical school to cultivate the next generation of fiber-optic technicians. As officials in Washington prepare to utilize more than $1.2 billion awarded to the state by the Broadband Equity, Access, and Deployment (BEAD) Program, one local ISP, Whidbey Telecom, is taking the initiative to make sure the state’s labor force is ready to handle the job. A new partnership forged between the ISP, the Fiber Broadband Association (FBA), and the Sno-Isle TECH Skills Center, a free, public school that serves high-school students from Snohomish and Island counties based in Everett, will help make the school’s planned offering of Optical Telecom Installer Certification (OpTIC Path) courses a reality. Earlier this month, nearly $4.5 million was allocated for Whidbey Telecom by the Washington State Public Works Board. The money will go towards constructing 44 miles of fiber to reach over 1,500 end users in the Clinton area. Read more.“Among fiber-only providers, AT&T Fiber topped the customer satisfaction ranking for the second year in a row with an ACSI score of 80.”4. Frontier Communications said it has garnered an additional $750 million in asset-backed security (ASB) funding. ABS is a type of financial investment that uses income-generating assets as collateral and is an alternative to other ways of raising capital. The notes will be secured by certain of Frontier’s fiber assets and associated customer contracts in North Texas. The company is leading the charge on ABS funding. Last August, it inked a $2.1 billion ABS deal, making it the first public company in the U.S. to secure funds backed by its FTTH assets. Earlier this year, the analysts at TD Cowen wrote that “FTTH ABS has been a game changer for Frontier and Ting, creating a new source of capital to help fund their builds.” Read more.5. AT&T Win. AT&T retained its top spot in ACSI’s fiber customer satisfaction ranking. The American Customer Satisfaction Index (ACSI) just released its annual Telecommunications Study, which provides a snapshot of how consumers perceive the big-name ISPs. Among fiber-only providers, AT&T Fiber topped the customer satisfaction ranking for the second year in a row with an ACSI score of 80. Following AT&T was “all others” (77), which ACSI indicated is a smaller group of fiber ISPs, Verizon Fios (77) and Lumen’s CenturyLink Fiber (76). AT&T’s placement wasn’t too surprising, according to ACSI Research Director Forrest Morgeson, as the company “continue[d] to score well in most individual aspects of fiber ISP satisfaction.” The operator in 2023 grew its fiber base by 1.1 million net adds. Read more.6. AT&T Loss. A judge at the California Public Utilities Commission (CPUC) rejected a petition by AT&T to walk away from its carrier of last resort obligations for voice service. In the petition in California, AT&T requested to be relieved of the carrier of last resort obligations, which would give it the ability to stop providing telephone service in rural areas. The judge rejected the AT&T petition. He ruled that he was unable to ignore the existing California rules that require carrier of last resort.He also ruled against the AT&T claim that California rules would require AT&T to keep copper. He noted that there is nothing in the California rules that would stop AT&T from decommissioning copper wires. The ruling notes that there is nothing in the California rules that would stop AT&T from replacing copper with fiber, wireless, or other technologies. The ruling says that AT&T is allowed to kill copper networks, but that carrier of last resort obligations require the company to provide an alternative technology that can bring service to households. Read more.“NTCA’s 3rd recommendation was to use the most future-proof technology possible. Although the association did not use the word ‘fiber,’ that is clearly what it had in mind.”7. Summit Ridge Announces $500 Million FCC Reimbursement. The money will reimburse ISPs affected by the FCC’s rip-and-replace program. Finance and business consulting firm Summit Ridge Group announced that it secured over $500 million in approved reimbursements for its clients through various FCC programs. The rip-and-replace program requires internet service providers to remove Chinese-manufactured equipment from their networks, specifically products from Huawei Technologies Company and ZTE, as the U.S. government has raised significant concerns about the potential for espionage and other malicious activities emanating from the Chinese government. Read more.8. NTCA Recommends Four Steps Toward Successful BEAD Projects. The Rural Broadband Association advises stakeholders to heed four recommendations regarding the $42.5 billion BEAD program. NTCA’s 1st recommendation advised providers to “monitor and participate in challenges.” The association also had some advice about the size of project areas that could apply to state broadband offices. Smaller, right-sized project areas target funds to the areas that most need them and will encourage program participation by those best able to serve them.  NTCA’s 3rd recommendation was to use the most future-proof technology possible. Although the association did not use the word “fiber,” that is clearly what it had in mind. NTCA’s 4th recommendation applies to legislators and advocates for not taxing broadband grants. Read more.9. FCC Looking to Alter LOC Financial Rules to Spur Rural Broadband. At issue is the FCC’s reliance on Weiss ratings to evaluate the safety and soundness of banks that have issued letters of credit to ISPs. Federal regulators are planning to review financial policies that could be hindering the rollout of broadband in rural America. At the same time, regulators want to be sure that a different approach will not expose taxpayers to losses. Read more.“The FCC voted unanimously to consider new rules sought by financial institutions and broadband Internet Service Providers that claimed current policy is frustrating the effort to close the digital divide.”10. Charter Communications is looking to hand back more than 1,400 more locations it had committed to serve as part of RDOF. The company says it has been unable to get the go-ahead from three tribal governments that oversee the locations themselves or necessary rights-of-way. Two tribes, Charter said, refused to grant the company access because they are pursuing fiber broadband projects owned directly by the Tribe or in partnership with local providers. The company is asking the FCC to waive any penalties for handing back the locations, since “Charter pursued the relevant rights-of-way in good faith, and no public interest would be served by penalizing Charter for stepping aside now.” Read more.11. FBA Quantifies Benefits of Replacing Copper with Fiber. The Fiber Broadband Association issued a new report analyzing the benefits of replacing copper with fiber. The report quantifies potential cost savings, which could be particularly useful for providers wanting to build a business case for the copper-to-fiber move. Read more.12. Insight on how one State Broadband Director will approach BEAD decision-making. Read more.    Broadband Bytes is a regular feature by David Levine of UCL Swift. David is a graduate of Northern Illinois University, a certified BICSI RCDD,and a 35-year industry veteran in fiber and copper solutions.He currently works as a Business Development Manager for UCL Swift.

Jun 20, 2024