Thursday, June 21, 2018

New Wireline Order Will Advance Fiber and 5G Deployment

On June 7, 2018, the FCC adopted a Second Report and Order that will accelerate the transition from legacy networks and services to next-generation networks and services and will eliminate FCC regulations that unnecessarily raise costs and slow broadband deployment. In March 2018, I authored a Perspectives from FSF Scholars titled “Reaching Rural America: Free Market Solutions for Promoting Broadband Deployment.” In the paper, I discussed ways Congress, the FCC, and state and local governments can remove barriers to entry into the broadband market to spur competition and advance deployment in rural and underserved areas. In particular, this wireline Order will reduce regulatory costs for broadband providers and advance the deployment of fiber and 5G networks.
A June 2017 paper by CMA Strategy and Corning found that the adoption of all of the proposed rules in the wireline Notice of Proposed Rulemaking (NPRM) would increase fiber broadband penetration by 26.7 million premises (residential and businesses), which corresponds to over $45 billion in capital investment. The paper also found that adoption of the full NPRM would increase 5G broadband penetration by 14.9 million premises, which corresponds to $24 billion in capital investment. For both fiber and 5G providers, over 95% of the $69 billion would be invested in rural and suburban areas. That means that the FCC’s wireline Order could lead to an additional $42.8 billion in capital investment from fiber providers in rural and suburban areas and an additional $22.8 billion in capital investment from 5G wireless providers in rural and suburban areas.
By expediting application processes and eliminating unnecessary requirements designed for legacy networks, the Second Report and Order in addition to a Report and Order adopted in November 2017 will modernize regulations and could lead to an additional $69 billion in fiber and 5G broadband investment.