The proposal on the FCC's Thursday agenda to update and streamline DBS rules comes as that industry's future is increasingly a question mark. An FCC official told us the vote (see 1909050043) is likely 5-0 and the item is seen is a housekeeping matter completing work of aligning DBS registration rules and procedures with other satellite services.
Matt Daneman
Matt Daneman, Senior Editor, covers pay TV, cable broadband, satellite, and video issues and the Federal Communications Commission for Communications Daily. He joined Warren Communications in 2015 after more than 15 years at the Rochester Democrat & Chronicle, where he covered business among other issues. He also was a correspondent for USA Today. You can follow Daneman on Twitter: @mdaneman
The accelerating rate of cord cutting as vMVPD uptake stumbled shows those over-the-top services aren't a big driver of the trend, said analyst Craig Moffett of MoffettNathanson in an interview on C-SPAN's The Communicators set to run this weekend. He said "the new normal" for traditional pay TV is subscriber declines of 5 percent or so per year. He said there's an ongoing bifurcation between sports watchers and entertainment viewers, with the latter leaving cable and direct broadcast satellite as sports programming's fixed costs keep driving up pay-TV subscription costs. Moffett said the state attorneys general challenge of T-Mobile/Sprint has "reasonably good odds" of derailing the deal since the takeover isn't meaningfully different from the first iteration of the transaction that DOJ rejected. He said it's unlikely any tech giants will be broken up under the current antitrust scrutiny because antitrust laws aren't well suited for that and Congress isn't likely to undertake an overhaul soon. He said net neutrality is a hot-button issue largely because the debate was cast in terms of "bad guy" ISPs and "good guy" companies like Netflix. But net neutrality no longer energizes the base and thus is absent from discussion by the Democratic presidential candidates. Moffett said the U.S. is "still a few years out" from having wide blocks of midband spectrum needed to enable the transformational services 5G promises, so in the near term, it will rely on narrow midband blocks. On vMVPDs, they're struggling because they have "fallen into the same trap" as traditional MVPDs by having to offer increasingly fat and expensive programming bundles, the analyst said. Eventually, live TV will be the home only of sports and news, with all other content moving to on-demand, he said. Cable system operators don't necessarily care about sustaining the bundle and can focus on their broadband offerings, but DBS operators "are in a much tougher position," he said, programmers even more so.
Satellite interests want changes to the FCC's proposed $950 million allocation of second-round USF funding to strengthen broadband networks in Puerto Rico and the U.S. Virgin Islands, after Hurricanes Maria and Irma in 2017. Award criteria for the Uniendo a Puerto Rico Fund and the USVI Funds are flawed, Hughes said in meetings with an aide to Chairman Ajit Pai, aides to Commissioners Geoffrey Starks and Mike O'Rielly, and with Wireless Bureau staff, per docket 18-143 postings Thursday (see here, here and here): Determining satellite isn't resilient technology is incorrect, since if the ground equipment is off island, it's by nature resilient. Hughes said the agency should include in bid evaluation the time it takes to deploy. It urged scoring that would give up to 20 points for 100 percent buildout within two years and fewer or no points for longer. The Coalition to Fund CPR membership, building a satellite-based model for emergency telecom services on the island, said the FCC should include locally based satellite communications facilities in restoration funding. It said funding should include new entrants with new technology, and allowing independent community-based emergency telecom networks to participate. The coalition said membership includes Tech Latina, National Puerto Rican Agenda, Ibero American Action League and Foundation for a Better Puerto Rico. Virgin Islands ISP Broadband VI argued against changing criteria for resiliency and redundancy, saying no data in the record supported doing so, and against applying a point reduction for backup power at customer premises in competing applications going through a brief public comment period. Commissioners vote at their Sept. 26 public meeting (see 1909040073).
As ISPs increasingly offer low-cost broadband programs similar to Comcast's Internet Essentials (IE), the number of eligible households climbs, though a significant amount of the subsidization goes to households that would have been subscribed anyway. That's per Technology Policy Institute President Scott Wallsten and Stanford University Public Policy Program Director Gregory Rosston, presented Thursday at the Telecommunications Policy Research Conference. The study looked IE from 2011 launch as a voluntary FCC condition on the NBCUniversal acquisition through 2015. It found about 66 percent of subscribers were increases in low-income adoption stemming from the program, the remainder households switching from a competitor ISP or that would have signed up given adoption trends. It said IE-eligible households were more likely to take online courses or training than households in the footprints of other providers. It's unclear whether, when competing ISPs offer similar programs, customers benefit much or if the bonus is to the provider in customer retention. Wallsten told us such programs don't necessarily point to solutions for the digital divide. IE targeted households lacking broadband, and might not fly politically with a government program, meaning automatically broader eligibility for subsidies, he said. As fewer lack connectivity, holdouts become increasingly hard to reach, especially since research shows price isn't the dominant issue, he said, noting IE's heavily reduced monthly bill attracted only a share of the target population online. Comcast didn't comment.
With rival estimates of cost and feasibility of fiber distribution to replace satellite C-band use before the FCC, experts told us there are issues about how fast such fiber could go up and about ongoing expenses. Being switched to fiber could force many small cable operators out of business, some fear.
With 3.5 GHz band commercial use rolling out nationwide, focus on clearing the 3.45-3.55 GHz band and studying possibly clearing at least some of 3.1-3.45 GHz or a sharing model like what's being used for the citizens broadband radio service (CBRS), FCC Commissioner Mike O'Rielly said Wednesday. At an event cheering that initial commercial deployment, O'Rielly hoped DOD follows through on the idea it floated of increasing the allowable power levels for the band. Pentagon spectrum chief Fred Moorefield said the department would be amenable to exploring that once it's "comfortable with the rollout. ... More spectrum sharing is the new normal."
Addressing better emergency alert origination and possible security risks 5G networks might inherit from previous communications networks, the FCC Communications Security, Reliability and Interoperability Council will issue reports next year and into early 2021, said CSRIC working group chairmen Tuesday. The 2018 false emergency alert in Hawaii (see 1801160054) shows there's no good emergency alert system differentiation between tests and actual alerts, said Craig Fugate, former Federal Emergency Management Agency administrator. Broadcasters voluntarily carry alerts, and without a strong working relationship between them and originators, there's a risk of fatigue, especially for amber and silver alerts, he said. Fugate said focus also is needed on cybersecurity and spoofing, to be sure alert originators are authenticated. He said the working group plans to produce recommendations by September 2020. Broadcasters increasingly use social media to communicate when they lose power to transmitters, newsrooms or towers due to disasters or major weather events, and social media will be a focus of reports on improving broadcast resiliency, said Florida Association of Broadcasters President Pat Roberts. It will look at updated best practices for prepping for natural disasters, he said. Its draft is due in January and final report in March, he said. Two working groups are looking at 5G security. Nsight Chief Technical Officer Lee Thibaudeau said network architectures sometimes incorporate security risks from other networks, and in 5G's case that could lead to confidentiality and network availability issues. He said the group looking at 5G vulnerabilities possibly carried forward from other wireless networks expects to have a report in June on those risks, followed by December 2020 recommendations on updates to 3rd Generation Partnership Project (3GPP) standards. Qualcomm Director-Engineering Farrokh Khatibi said his group's related reports on risks potentially introduced by 3GPP standards will come in September 2020, and on ways of mitigating those in March 2021. The 911 move from legacy to IP networks carries potential security risks, especially when those networks are blended, said Mary Boyd, West Safety Services vice president-government and regulatory affairs. A working group report identifying the security risks in legacy, transition and next-generation 911 networks is expected in June, she said, followed by a December report measuring the risk magnitude and remediation costs. Verisign Chief Security Officer Danny McPherson said a report on session initiation protocol security vulnerabilities that could affect communication service provision is expected by March 2021.
A Maine law requiring cable operators provide video service a la carte and facing cable industry legal challenge isn't likely to be replicated elsewhere soon, experts told us. A cable lawyer said more cable suits challenging this law seem unlikely because the Comcast/programmers litigation (see 1909100041) is likely sufficient. Charter Communications, whose service footprint covers much of Maine, and America's Communications Association didn't comment Monday.
The C-Band Alliance is "aggressively looking" at ways to make more than 200 MHz of 3.7-4.2 GHz spectrum available over a three-year span for 5G, Peter Pitsch, head-advocacy and government relations, told us. FCC Commissioners Brendan Carr and Mike O'Rielly may want more than 200 MHz (see 1903210017 and 1905200006). CBA had said 200 MHz was the best it could do near term (see 1810230025). The Competitive Carriers Association, America's Communications Association and Charter Communications are championing a plan they say would provide at least 370 MHz.
With one appeal filed of the FCC cable local franchise authority order, multiple other plaintiffs are expected to appeal and intervene by the Oct. 28 deadline, 60 days after the LFA order was in the Federal Register. Coalitions of local communities and states are seen as possible plaintiffs.