Editorial: Not So Fast

Wheeler plans to add $1.5 billion to phone bills in E-rate revamp
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FCC chairman Tom Wheeler, who often complains about the price of consumers’ bills (usually cable), plans to add as much as $1.5 billion to their phone bills. That’s OK, says the FCC, since it’s for a good cause: speed and education.

The money would go toward increasing the funds in the E-rate subsidy and it’s undeniably a laudatory end-result— getting faster broadband to low-income schools and libraries. But it illustrates the somewhat less preferable point that to get value, one must pay for it. How much value boosting the budget will create is a matter of dispute, but the point is the chairman recognizes that offering more and better broadband is worth paying a little extra for.

Let’s just put this on the schedule as a reminder when the “high cable bill” mantra surfaces. As Wheeler knows, having headed the National Cable & Telecommunications Association and CTIA: The Wireless Association, building out a network is not cheap, and recovering that investment takes years, particularly if you are rate-regulated.

We thought the chairman’s announcement of the revamp to the E-rate program lacked a little something. That would be a shout-out to commissioner Jessica Rosenworcel, who has been championing transitioning the E-rate from a focus on deployment to one on speed. And speed is probably the biggest takeaway from the E-rate expansion.

Cable operators are clearly on notice that speed increasingly will be the definition of broadband deployment and access, whether that is schools and libraries or homes and businesses. That means a tougher fight to keep insufficient speed from becoming a blank check for overbuilding of existing plant or applying regulatory “fixes” to broadband in the name of remote healthcare or energy monitoring or education.

Broadband is indeed taking over every part of daily life; the concern is that the government will consider that an invitation for it to follow suit.

FCC chairman Tom Wheeler, who often complains about the price of consumers’ bills (usually cable), plans to add as much as $1.5 billion to their phone bills. That’s OK, says the FCC, since it’s for a good cause: speed and education.

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