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Comcast Follows AT&T's Litigious Lead In Nashville

Comcast is the second Internet Service Provider (ISP) suing the mayor and metro government of Nashville, Tennessee (pop. 680,000) to stop a new ordinance to give streamline access to utility poles in the city, reports Cnet.com news.

Comcast’s October lawsuit over the Google Fiber-supported One Touch Make Ready ordinance (OTMR) comes on the heels of AT&T's legal action in late September. We wrote about AT&T’s lawsuit shortly after the filing.

Cnet.com reported that most of the utility poles are owned by Nashville Electric Service (NES) or AT&T, but Comcast has wires on many poles and has control over how these wires are handled. “When Google Fiber wants to attach new wires to a pole, it needs to wait for Comcast to move its wire to make room, and this is where the new ordinance becomes controversial.”

Comcast’s lawsuit, filed in U.S. District Court in the Middle District of Tennessee, contends the AT&T-owned poles fall under the purview of the Federal Communications Commission (FCC) and not the city, and that Nashville Metro Council lacked authority to regulate NES poles, according to a story in the Tennessean newspaper.  The telecommunications carrier is asking for a permanent injunction to stop enforcement of the ordinance. 

Comcast reproduces AT&T's argument in Nashville - that the poles are within federal jurisdiction so the city does not have the authority to enforce such an ordinance.

Reverse Preemption In Louisville

AT&T also filed a suit this past spring in Louisville, Kentucky, to stop the city from implementing a similar ordinance. As in Nashville, the city put the policy in place to encourage new entrants like Google by speeding along a cumbersome and time consuming make ready process.

In the Louisville case, however, the FCC submitted a Statement of Interest in late October addressing the issue of authority over poles. According to the document filed with the court:

BellSouth [AT&T] maintains in its motion for summary judgment that the Louisville Ordinance conflicts with, and is therefore preempted by, the federal pole attachment rules promulgated by the Commission under Section 224. That argument is wrong as a ma er of law. The federal pole attachment regulations do not apply in Kentucky because Kentucky has filed a certification invoking reverse-preemption under Section 224(c) and has thereby opted out of the federal pole attachment rules. 

The FCC exercises jurisdiction over pole attachments under Section 224 “only in states that do not so certify” that they regulate pole attachments…BellSouth is thus wrong to assert a conflict with the federal pole attachment rules in these circumstances. 

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As a result, the FCC has no jurisdiction over Kentucky’s poles. In fact, the Statement of Interest goes on to support OMTR policies, stating that: 

”As a general matter, promoting the deployment of competitive broadband infrastructure through one-touch make-ready policies is consonant with the goals of federal telecommunications policy, the Communications Act, and applicable FCC regulations.”

Nashville Leaders Press On 

Back in Nashville, officials expressed disappointment at Comcast’s lawsuit, but resolve at creating a better environment for competition.

In a statement, Nashville Mayor Megan Barry said:

“One Touch Make Ready has been litigated in the court of public opinion, and the public overwhelmingly supports this measure designed to speed up the deployment of high-speed fiber in Nashville. Now, we hope that this federal litigation is quickly resolved so that we can get on with the business of expanding access to gigabit Internet throughout Davidson County.”

Google Fiber Pauses - But No One Else Should

Google Fiber has finally announced its plans for the future after weeks of dramatic speculation that it will lay off half its workforce and give up on fiber-optics entirely. Google has now confirmed our expectations: they are pausing new Google Fiber cities, continuing to expand within those where they have a presence, and focusing on approaches that will offer a better return on investment in the short term.

Nothing Worth Doing Is Easy

In short, Google has found it more difficult than they anticipated to deploy rapidly and at low cost. And in discussions with various people, we think it can be summed up in this way: building fiber-optic networks is challenging and incumbents have an arsenal of dirty tricks to make it even more so, especially by slowing down access to poles.

That said, Google is not abandoning its efforts to drive better Internet access across the country. In the short term, people living in modern apartment buildings and condos will be the greatest beneficiary as Google takes the Webpass model and expands it to more cities. But those that hoped (or feared) Google would rapidly build Fiber-to-the-Home (FTTH) across the country are likely disappointed (or slightly relieved, if they happen to be big incumbent providers). 

This is a good moment to talk about the lessons learned from Google Fiber and what we think communities should be thinking about. 

Let's start by noting something we have often said: Google Fiber and its larger "access" approach have been incredibly beneficial for everyone except the big monopolists. Its investments led to far more media coverage of Internet access issues and made local leaders better understand what would be possible after we dismantle the cable broadband monopoly. 

Benoit Felton, a sharp international telecommunications analyst wrote a very good summary of Google Fiber titled Salvaging Google Fiber's Achievements. Some of my thoughts below overlap his - but his piece touches on matters I won’t address, so please check out his analysis.

I want to focus on a few key points.

This is Not a Surprise

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Google is a private firm that has a fiduciary responsibility to maximize returns for its shareholders. More to the point, so is Alphabet, which houses Google Fiber. Google's interest in fiber was not solely pulling revenue out of the network in the same way that Comcast, AT&T, and others do. They wanted to maximize good Internet access to get more people to use the Internet more and thereby increase the value of their ad business. That is why they have been more consumer-friendly in many ways than the big cable and telephone companies. Google believes it wins even when it simply forces other providers to upgrade their networks.

The fact that they are now focused on doing that in a different way or changing the way they are driving network upgrades should not be surprising. Fiber-optic investments in single-family home neighborhoods can take many years to break even whereas using a hybrid fixed wireless and fiber strategy to target the tens of millions of people living in apartments and condos is likely to break even much quicker. 

That said, if One Touch Make-Ready policies succeed in Louisville and Nashville, I think we will see more Google Fiber investment in FTTH.

But Google is fundamentally a private firm focused on its shareholder value. And as such, it does not have the right incentives to deploy what has become essential infrastructure. Many of us have objected to the market-driven approach that tends to leave low-income areas behind. Nevertheless, Verizon and AT&T have left far more neighborhoods behind than Google. We believe universal access will be more difficult after market-driven approaches skim the cream out of our cities, leaving public funds to ensure everyone has access.

Fiber Remains A Good Municipal Investment

There is no wireless technology today that will cost-effectively deliver a high capacity connection to single-family homes that gives a deployer a technological advantage over modern cable systems (yes, we need better networks than cable networks offer). Google is not abandoning fiber in favor of wireless. It is changing its focus from near-citywide deployments to buildings with many tenants, where it can use both fiber and fixed wireless approaches to deliver service quickly. 

If anything, Google Fiber's change in focus reinforces the importance of smart municipal investments. That can mean a range of things, from Chattanooga or Lafayette approaches to Lincoln's conduit model to Ammon's software-defined network open access approach.

This is especially true in light of 5G wireless, which is still far on the horizon and will require fiber deep into neighborhoods - more fiber than the wireless carriers can easily deploy. Cities that make it easy for the wireless carriers to deploy small cells and connect it with affordable fiber will get these technologies faster and better than those that just wait for the private sector to do everything. Stay tuned to Broadband Bits for an upcoming podcast on how Lincoln has a brilliant model for that.

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Waiting Can Only Hurt You

Whether a community intends to offer services directly or simply to encourage more independent service providers, it is now clear that they need to take action. The "Google Lottery" is temporarily suspended. Get busy finding an approach that fits your needs and challenges.

This is especially true for cities that have real potential to meet their needs with smart local investments but have been waiting and waiting at the altar for Google - ahem, Palo Alto, Portland, and others. Stop dawdling and get serious. You have the capacity to do something. Get started.

Google may resume new FTTH build outs, and when it does - it will undoubtedly look more favorably on communities that have dark fiber, conduit, and other assets ready for them. And if Google remains paused much longer, then you will have created assets to use for your own deployment or for attracting a different partner. 

Speaking of a different partner, Elliot Noss of Ting reminded me that Google can play around with autonomous cars and artificial intelligence in a big way today. Since they launched fiber, the opportunity cost of using their capital has changed significantly. Compared to the potential returns for deploying fiber to single family homes, A.I., and the potential to control all future vehicular movement seems more lucrative.

Once again paraphrasing Elliot, one of the core talents of an ISP should be dealing with people - from installers to customer service. This is not a core area for Google. Google's engineers have done a stunning job creating their technologies - especially the DVR system. But being a competitive ISP is not just technology - it is interacting with your subscribers.

While Google may be in a pause, Ting is excited to keep moving on. Travis Carter of US Internet in Minneapolis can't wait to lay more fiber next year (winter is about to slow his deployment up here); they see nothing but potential in coming years.

Wireless Is Not Killing Fiber

I want to be especially clear. Companies like AT&T and Verizon love stories about how fiber is too expensive or uneconomic. They have a customer base to protect from competition. They are thrilled when they can scare potential investors in fiber networks.

5G is not magic and won't meet all of our needs. When I started working in this industry 10 years ago, I was told that Wi-Fi obviated the need for fiber. WRONG. But then, I was told that fiber wasn't necessary because WiMax would meet all our needs. WRONG. And then it didn't take long before fiber was supposedly unnecessary because 4G LTE was going to do everything except solve world hunger. WRONG. 4G remains a complement to fiber, not a substitute.

When I talk to people that have only 4G and not a wired service in their homes, they usually complain - whether it is the cost, reliability, or some other factor. And when you look closer at 5G, it is clear that FTTH continues to be a smart investment. And when building a FTTH network, you have an opportunity to lease fiber to those deploying 5G, another revenue source.

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Google is not scared of the possibility of 5G making fiber uneconomic. Google is frustrated at the pace of deployment because both pole owners and the networks already attached to utility poles can dramatically slow critical access to those poles by using every day of their allotted time to make a pole ready for a new attacher. 

This is not about city permitting - we have once again seen that even when cities bend over backwards to ease deployment access, it is the incumbent providers that continue to be the biggest barriers to new investment (this reinforces a CTC report that communities could reduce outside plant costs by 8 percent at most). There is just no way getting around the mismatch between private sector business models and the need for critical infrastructure. It is capital-intensive and offers a slow return, especially when done correctly.

The Private Sector Needs You

The private sector, Google included, simply cannot solve this problem alone but cities can change the calculus. Phil Dampier agrees. Blair Levin has been making this case for years - see the Next Generation Network Connectivity Handbook [pdf], for instance. But take care with those that are too focused on private investment. Cities need to be very careful in partnerships and should not rely too much on the private sector - our report offers suggestions for how to get the right balance.

Google is taking a pause, but it should be a kick in the pants for the rest of us. Time to get busy building the infrastructure of tomorrow - because some cities already have it today and we don't want to let them have all the fun.

AT&T Makes Good On Threats, Sues In Nashville

AT&T lawyers filed suit against Nashville just two days after Mayor Megan Barry signed the new One Touch Make Ready (OTMR) ordinance into law. The Metro Council passed the proposal for the final time, and sent it on to the Mayor, on September 20th.

Seeking Out Streamlining

OTMR was proposed by Google Fiber, which wants to enter the Nashville market by deploying an aerial fiber network. In order to do that, they need to attach fiber-optic cables to utility poles around town, but the current process is cumbersome and will significantly delay the rollout. OTMR streamlines the procedure but would allow some one other than AT&T to manage the rearrangement of wires on all poles in the Nashville rights-of-way. The telecom giant owns about 20 percent of the poles in Nashville; the city’s electric utility, NES, owns the rest.

Three Arguments

AT&T seeks a permanent injunction to stop the city from enforcing the new ordinance. They argue the city does not have the authority to enforce the ordinance - that role is within federal jurisdiction through the FCC.

They go on to state that the Metro Council does not have the authority to pass the ordinance because, according to the city charter, only the Electric Power Board the has the right to pass regulations that deal with issues related to equipment, such as poles and the cable on them. 

AT&T also asks that the court grant a permanent injunction on the basis that they already have a contract with the city relating to AT&T’s wires that are on NES poles. The contract allows the company to handle its own wires and enforcing the ordinance would basically nullify that component of the contract.

What This Is Really About

AT&T filed a similar suit in Louisville earlier this year when the Metro Council there passed OTMR; that suit is still ongoing. Google Fiber wants to serve both communities and, in typical AT&T fashion, the telecom giant is attempting to use the courts to put a block on them. Even before the final Metro Council vote, AT&T threatened to sue if the measure passed. “The short answer is the One Touch Make Ready proposal Google has offered is a proposal that we expect would result in litigation,” said Joelle Phillips, President of AT&T Tennessee. Mayor Barry had asked that the ISPs and NES all work together to come up with an agreement but AT&T was determined to slow Google Fiber’s deployment, hindering its success.

Lawyers On Loan

Google Fiber has offered assistance to Nashville in the form of its legal team. Before the final vote, Google’s parent company Alphabet had already committed to helping out:

“Google Fiber is disappointed that AT&T has threatened to go to court in an effort to block Nashville’s efforts to increase broadband competition should the OTMR ordinance pass,” Fleur Knowlsey, senior counsel of Alphabet’s Access group, which manages Google Fiber, wrote in an email to the council on Monday.

“We believe the city's commonsense initiative will be upheld in the face of any litigation. We know, however, that litigation can be challenging and expensive. In the event of OTMR litigation, Google Fiber will therefore be glad to share the capabilities of its in-house and outside attorneys, including some of the most experienced and accomplished regulatory attorneys in the industry.”

Read the complaint here.

Nashville: One Touch Make Ready Moves Forward

On September 6th, the Nashville Metro Council approved a proposed One Touch Make Ready (OTMR) ordinance by a wide margin of 32-7 on a roll call vote (computers were down). This was the second vote to advance the ordinance, designed to streamline deployment of fiber-optic networks in a city looking for better connectivity. Elected officials responded to Nashville residents who flooded their council members’ offices with emails.

The Nashville Metro Council will take up the ordinance one last time; passage could speed up competition in the country music capital. Google Fiber has been pushing for a OTMR, while incumbents AT&T and Comcast look for a non-legislative solution to the problem of the poles while protecting their positions as dominant Internet Service Players (ISPs).

Caught Between A Rock And A Hard Stick

The city of Nashville sits on limestone, a rock that cannot support the trenching and underground work of fiber deployment. The only other option is to use the utility poles. Eighty percent of the poles are owned by the public utility Nashville Electric Service (NES), but incumbent provider AT&T owns the other 20 percent. Google Fiber says it needs to attach fiber to 88,000 poles in Nashville to build its network and about half of those (44,000) need to be prepared to host their wires. 

Pole attachments are highly regulated, but there are still gray areas. Susan Crawford provides an overview of the policies and regulations on BackChannel; she accurately describes how poles can be weapons that guard monopoly position. Currently, each company that has equipment on the poles must send out a separate crew to move only their own equipment. This process can drag on for months. The OTMR ordinance is a deceptively simple solution to this delay. 

Deceptively Simple, But Regulated

At its simplest, OTMR means that one crew moves everything; the ordinance under debate in Nashville is actually more complicated than that. (Read the Nashville OTMR ordinance here.)

If Company A wants to add equipment to the poles, it still has to go through an attachment application process. Once approved, the owner of the pole (let's call them, PoleCo) can then require Company A to use specific contractors. 

If Company A rearranges or alters equipment that belongs to PoleCo or some other company that may have equipment on the pole, then they have to notify the owner of the equipment within 30 days. The company whose equipment has been altered, has another 30 days to conduct a field inspection with PoleCo.  

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If the pole requires complex work, then every company already on the pole gets 30 days notice to move their equipment. If those companies do not comply after 30 days, then Company A can perform the complex make-ready work. If there are any errors or problems from Company A's make-ready work, the companies already on the pole can recoup expenses. 

NES explained the basics of the current process and the idea behind OTMR in their newsletter. The public utility did not take a positive or negative position on the ordinance, choosing instead to focus on the final result:

"NES is dedicated and cooperative towards finding a resolution that will accommodate the efficient and effective deployment of broadband services that promote customer choice and competition and improve the lives of the citizens of Nashville."

The Incumbent Providers: Comcast and AT&T

Nashville Mayor Megan Barry has remained neutral on the policy, but has encouraged NES and the tech giants to reach a mutually beneficial solution for the good of the community. If the councilmembers approve the ordinance a final time, it will go to her desk for a signature.

AT&T may be preparing for a lawsuit against Nashville if this is the case. They already have an ongoing legal fight in Louisville, Kentucky, over OTMR. AT&T argues that the ordinance change would conflict with their contracts with NES and the union. The Nashville Metro Council Attorney Mike Jameson analyzed the ordinance for the Council and determined that Nashville clearly has the power to regulate the NES’s utility poles, but perhaps not the privately owned utility poles. 

Comcast, meanwhile, has claimed that the NES’s attachment application process is a source of delay (i.e. that Google Fiber is blaming the wrong process). Comcast is experiencing 90-100 days of processing for their applications to NES. The contractual obligation between Comcast and NES is 45 days to process applications, but Comcast has also “exponentially” exceeded the number of poles that they can apply for in a month under that contract, according to NES official Nick Thompson in the Tennessean.

Meanwhile, Councilmember Anthony Davis, a cosponsor of the OTMR ordinance also told The Tennessean that Google Fiber is not experiencing the permitting delays because it has already worked out a contract with NES. 

The Final Vote

In two weeks, the bill returns for a final vote on September 20, 2016. Councilmember Jeremy Elrod, one of the bill’s cosponsors, described the last vote on September 6, 2016 in The Tennessean:

"This is an extremely big step forward, an extremely big net positive for Nashville, for internet competition. … It increases competition, increases telecom and Internet investment for [us] as a city and our citizens as a whole."

Photo of utility workers courtesy of FEMA through a Creative Commons license.

Nashville Considering One Touch Make Ready

In 2015, Nashville welcomed Google Fiber with open arms, anticipating all the possibilities gigabit connectivity could mean for businesses and residents. The deployment is moving slowly, however, in part because of time consuming make ready work on utility poles. In order to speed up the process and establish better policy for the city in general, Nashville has just introduced a one touch make ready ordinance.

Too Many Wires

A recent Nashville Scene article described the situation, common in a number of communities where utility poles already carry a number of wires:

The thousands of poles that stand around the city, most of which are owned by Nashville Electric Service, are arranged with power on top and communications equipment in a line below that. In Nashville, this means NES equipment pushes electricity up top, while broadly speaking, gear from Comcast and AT&T — whether for home phone, cable or internet service — operates below. 

Enter Google Fiber. Because Nashville largely sits on a massive bed of limestone rock, running cable underground is, for the most part, not a viable option. That means Google has to join its new friends in the industry on the poles, through a process known as Make Ready. In a typical scenario, that involves Google — or any other new company trying to enter the market or get on a particular pole — notifying NES, which will then notify each telecom company that it needs to send a crew to the pole — one after another — to move their equipment and accommodate the new party. The process can take months, even if contractually mandated time frames are followed. Google Fiber officials and operatives working on their behalf suggest that’s not always the case. 

One-Stop Approach

One touch make ready will allow one entity the ability to move all the wires from all the entities at one visit. Louisville, Kentucky, has enacted one touch make ready but AT&T and Frontier have joined forces to sue the city to stop it. The policy cuts costs and streamlines deployment for new entrants, thereby encouraging competition, so incumbents are not fond of the idea.

Nevertheless, the state's Department of Economic and Community Development (TNECD) recently released the results of a study which included one touch make ready one of several recommendations. Enacting the policy is a way to control poles and proactively handle many of the disputes that can arise between entities that use them.

Learn more about Louisville's approach to one touch make ready; listen to Christopher interview Ted Smith, the city's Chief Innovation Officer, in Episode #193 of the Community Broadband Bits podcast.

AT&T Tries to End the Magic of One Touch Make-Ready

On the border of Kentucky and Indiana a fight is brewing as AT&T and Google Fiber have both announced plans to bring Gigabit Internet service to Louisville, Kentucky. Home to over half a million, the city could see major economic development with new ultra high-speed Internet access, but there’s a problem: the utility poles.

AT&T is suing the city over a “one touch make-ready” ordinance. On February 11, 2016, the Louisville Metro Council passed the ordinance in order to facilitate new competitors, i.e. Google Fiber. 

Utility Poles: Key to Aerial Deployment

Make-ready is the shorthand for making a utility pole ready for new attachments. Although it may seem simple, this process is often expensive and time-consuming. To add a new cable, others may have to be shifted in order to meet safety and industry standards. Under the common procedure, this process can take months as each party has to send out an independent crew to move each section of cabling. 

To those of us unfamiliar with the standards of pole attachment it may seem absurd, but this originally made sense. Utility poles have a limited amount of space, and strict codes regulate the placement of each type of cable on the pole. Competitors feel they have to fiercely guard their space on the pole and cannot trust other providers to respect their cables. Make-ready must involve coordination between multiple providers and the utility pole owners. For some firms, like AT&T, this is an opportunity to delay new competition for months.

“One touch make-ready” simplifies the entire process. A single crew only makes one trip to relocate all the cables as necessary to make the utility pole. Under the amended ordinance in Louisville, the company that wants to add a cable to the utility pole can hire a single accredited and certified crew, approved by the pole owner, which will accomplish the work much more quickly and at lower cost. Also, it must pay for needed fixes or any damages to the pole-owner’s equipment and inform the pole-owner of any changes within 30 days. Such “one touch make-ready” policies quicken network deployments by preventing delays inherent in coordinating many different entities.

Why Oppose It? Private Utility Pole vs. Public Right-of-Way

AT&T is suing to stop Louisville from implementing this new policy in an effort to stop the new competition from entering the market. Ostensibly, AT&T argues they filed the suit because they own many of the utility poles (an estimated 25-40%) in Louisville. The company argues that the municipality does not have the authority to regulate the utility poles and that this is an unjust seizure of property. In other communities where this is the case, the new companies that want to use the utility poles must sign a licensing agreement with AT&T. 

AT&T’s argument, however, fails to recognize that local governments are required to manage the public Rights-of-Way (in layman’s terms, that is the land kept for the public interest near a roadway). The utility poles, although privately owned, serve a key function for connecting the public with needed services. That is why those utility poles are permitted on the public Right-Of-Way in the first place. Local governments, moreover, must have the authority to ensure that anything permitted on the public Right-Of-Way, such as utility poles, meet safety and industry standards in the quickest and most efficient way possible. 

Further Resources on “One Touch Make-Ready”

Chris interviews Ted Smith, Chief Innovation Officer for Louisville in Community Broadband Bits Episode 193. Smith describes how “one touch make-ready” is quicker, safer, and more efficient to use the utility poles in the public Rights-of-Way to their full potential for the good of the community.

For more information on the importance of “one touch make-ready,” check out analyses from the Coalition for Local Internet Choice, Next Century Cities, and FTTH Council. For an in-depth analysis of Right-of-Way regulations, listen to Sean Stokes of Baller, Herbst, Stokes & Lide on Community Broadband Bits Podcast Episode 169.

One Touch Make Ready and Wireless Innovation in Louisville - Community Broadband Bits Podcast 193

When we asked Ted Smith, Chief Innovation Officer of Louisville, Kentucky, to join us for episode 193 of the Community Broadband Bits Bits podcast, we expected to talk about the one touch make ready policy they had enacted (and AT&T has since sued to stop). We did, but we ended with a focus on how networking is already improving the city.

We start off by focusing on the problem of adding new fiber networks to existing poles (many of which are owned by telephone company incumbents that are not particularly inclined to make life easy for new competitors). One touch make ready simplifies the process, resulting in many benefits for communities in addition to lowering the cost to build new networks. We explore that topic to start.

But at the end of the discussion, Ted and I discuss what Susan Crawford has termed a responsive city approach - Louisville is using all kinds of network attached devices to improve city services in some of the lowest income neighborhoods.

Read the transcript from this show here.

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Thanks to Kathleen Martin for the music, licensed using Creative Commons. The song is "Player vs. Player."