"Broadband to the Home: Broadband to America"

FCC Commissioner Deborah Taylor Tate

Broadband Properties Summit

Dallas, Texas

April 30, 2008

Thank you, Mike, for your kind introduction. I also would like to thank
Scott DeGarmo and Hilda Legg for the invitation to speak before you
today. And I would like to offer congratulations to all those
individuals and companies who received awards at this event. Many of you
have been the pioneers in this sector, and we owe you a debt of
gratitude for your role in the deployment of broadband, especially in
the rural parts of this great country.

The Broadband Properties Summit is a premier event for the nation's
leading developers and providers of broadband service. And as industry
leaders, you recognize that broadband is critical to our country's
future -- critical not only to the communications sectors but indeed to
every sector of the economy, from healthcare to education and financial
services and more. Having just returned from the 7^th^ APEC-Tel meetings
-- an Asian-Pacific Ministers of Communications and Information
conference in Bangkok -- I can assure you that broadband is the number
one issue globally as well.

In Bangkok we had sessions ranging from cyber security to digital
prosperity to challenges facing universal service. Your agenda here also
is ambitious, focused on the practical applications of technology to
achieve broadband deployment. While the U.S. leads the world in
broadband connections -- 100 million as of the beginning of this year --
there is still much to do. I want to assure you that whether the issue
is the recent and very successful \$19 billion spectrum auction, or
support for a rural healthcare initiative, or numerous other issues
across all platforms -- all of these underscore the Commission's efforts
to promote broadband to [all]{.underline} Americans, regardless of their
race, gender, income, or zip code. We apply this goal of promoting
broadband at all times, and to all services we oversee. Whether
considering rules for phone service, cable service, terrestrial wireless
service, or satellite service, the overarching and critical
communications goals of the Commission include the promotion of
broadband deployment.

**[Why Broadband Matters]{.underline}**

Why does this matter? Even if we looked only at the economic effects,
the gains from further broadband deployment would be enough to get our
attention. A recent study by Connected Nation estimated that increased
availability of broadband across the U.S. would have a positive economic
impact of \$134 billion.

But of course, this is about more than just numbers. A broadband
connection to the World Wide Web literally is a connection to our very
wide world. With the click of a mouse, our children can go on an
educational adventure -- to the Louvre or the Library of Congress, on an
exploration of the Great Barrier Reef or the Great Wall of China. Adults
can attend class at a university across the country while holding a job
across town. They can also participate in local civic affairs or even
get involved in politics at the national level. In fact, in just one
presidential cycle, Internet advertising has gone from essentially zero
to estimates that they will exceed \$100 million in 2008. In addition,
workers can positively impact their productivity and even obtain virtual
employment opportunities. Families can get better access to healthcare,
such as teledentistry, telepsychiatry and even telesurgery.
Telecommuting for doctors makes the physical distance between provider
and patient immaterial, and this ability to shrink distances that
isolate our most remote communities makes broadband particularly
critical in rural areas. I am very involved with issues such as
telemedicine and electronic medical records in Tennessee and know that
Hiawatha Broadband was discussed in a previous panel, and I applaud what
you and many others are doing for our most remote and sometimes isolated
citizens. I have had the opportunity to see first hand in Alaska how
broadband communications enables this kind of empowerment for those who
are most physically isolated. In short, broadband revolutionizes how we
communicate, how, where and when we work, how we educate our children,
the delivery of healthcare and public safety, as well as how we
entertain ourselves.

**[How We're Doing]{.underline}**

Because broadband is critical to our country's future, there is much
work yet to be done. But before I describe where we should look to go,
let me say a few positive words about how far we've come.

Providers like you should be applauded for the more than 100 million
broadband connections in the country as of mid-2007, and our policies
should encourage you to continue to invest heavily in broadband
deployment. The Telecommunications Industry Association estimates that
broadband spending was \$15 billion in 2007 and that this figure will
rise dramatically over the next couple of years, to \$23 billion by
2010. More than 99 percent of the U.S. population lives in zip codes
where a provider serves at least one customer. Broadband via DSL is
available to 82 percent of the households that receive service by a
local exchange carrier, while broadband via cable modem is available to
96 percent of households that receive cable television. Virtually all of
our schools have high-speed Internet connections, and have had them for
a number of years, thanks in large part to the E-rate program. Workplace
broadband connections are more and more common.

This investment is part of the revolution occurring in the broadband
marketplace as true convergence has become a reality, with the Internet
breaking down the barriers that previously separated networks.
Telecommunications companies are deploying next generation fiber
networks. Cable operators continue to upgrade their networks to enable
them to offer digital video, broadband and voice service. Wireless
carriers are upgrading their networks and acquiring spectrum to offer
advanced mobile services and even video in the palm of your hand.

At the same time, we can and should improve broadband access to more of
our citizens. Much has been made of the recent OECD report that the U.S.
ranks 15^th^ among 30 OECD nations in broadband penetration. But in
order for such a statistic to be useful, we need to understand what it
really means. For example, as the Phoenix Center points out, the OECD
report does not consider differences in the size of households across
countries, not does it count Internet access that is available via the
thousands of hotspots and libraries in the U.S. Moreover, broadband
usage depends on a variety of factors, ranging from demographics, to
educational levels, to, of course, the price of broadband.

When considering broadband penetration in the U.S. -- and what
policymakers might do to promote more of it -- we should be mindful of
the unique characteristics of the U.S. market. And when we compare the
U.S. market to that of other countries, we should be mindful of how
countries differ. For example, failure to properly consider differences
in household size or population density across countries can confuse the
analysis. To illustrate with an example that is a bit more personal for
me, consider South Korea, which has an impressive level of broadband
penetration. While South Korea is about the same size as my home state
of Tennessee in terms of geography, it is much larger in terms of
population. In fact, in order to equal the population of South Korea,
Tennessee would need to add a few people to its current population,
roughly everyone in the nearby states of Mississippi, Alabama, Georgia,
South Carolina, North Carolina, Virginia, and Kentucky. High population
density enables the achievement of a higher penetration rate. These are
basic economics of the industry that you, the providers of service
across the U.S., understand better than anyone. It's easier to achieve a
high penetration in Manhattan than Mississippi.

This is [not]{.underline} to say that there is no role for policy. We
all want broadband to do as much to promote jobs in Mississippi as it
does in Manhattan. The question, therefore, is what is the right policy?

**[Regulatory Philosophy]{.underline}**

I have been a strong proponent of a light regulatory touch for broadband
service provided over cable systems, telephone lines, power lines, and
wireless platforms. This helps ensure what we refer to as a level
playing field -- or equality of regulation -- among competing providers,
no matter the technology or business model.

Such a light-touch approach also is consistent with my regulatory
philosophy, which is simple, straightforward, and built on a long
tradition of limited but effective government. It calls for, first and
foremost, regulatory humility -- something I have tried to practice,
both as a state regulator and now a federal one. I look to and
especially encourage the industry -- you -- to put forward creative,
market-based solutions whenever possible. I recognize that most of the
consumer benefits we see in the communications sector of the U.S.
economy are directly related to the significant levels of competition in
this sector, driven by deregulatory policies that have encouraged
investment and thus fostered that competition.

Of course, I also understand the need for regulation to promote
well-specified social goals that otherwise might not be addressed, such
as E911. More specifically, I understand the need for regulation if and
when there is a clear market failure. Such market failure is probably
less common in communications markets as compared to other sectors, but
we should not assume that it does not exist.

At the same time, we should not assume there will not be "government
failure," such as when we adopt rules and regulations that we expect
will benefit consumers but, in the long run, do not in fact do so. I
recognize that policymakers, like businesspeople in the market, make
mistakes, too. Perhaps this is why former President Ronald Reagan used
to say that the nine most feared words were "I'm from the government and
I'm here to help." Well, I'm from the government, and I'm here to
listen. My door is always open and I value your input as we consider
such critical issues and their impact on broadband deployment.

In short, I favor a common sense, balanced approach to regulation, one
that neither overreaches nor fails to respond to specific problems.
There are many recent examples of how the Commission has taken such a
balanced approach.

**[Policies Promoting Broadband]{.underline}**

With regard to our deregulatory policies, the Commission has removed
major impediments to broadband deployment. There are many examples. (1)
We have classified broadband provided by DSL, BPL and wireless
technologies as "information services" that will be subject to fewer of
our outdated legacy rules. (2) We streamlined our video franchise
process, which will make it easier for new entrants such as telcos to
provide broadband service as part of a triple play -- voice, video and
data. (3) We recently launched a \$400 million, nationwide pilot program
to promote broadband for healthcare facilities. (4) We also recently
made available more spectrum for the provision of wireless broadband
services in the 700 MHz auction that raised more money than any spectrum
auction in U.S. history. This spectrum is part of the DTV transition --
scheduled for February 17, 2009 -- and portions of it will be used to
provide commercial services, to include fixed and/or mobile wireless
broadband services, while other portions will be used to provide an
interoperable broadband network for the benefit of public safety.

\[For more information, check out the website at
[www.dtv.gov](http://www.dtv.gov/).\]

\(5\) In addition, we have taken steps to reform our universal service
program so as to make it more efficient and more able to provide service
were it is most needed. As Chairman of the Joint Board on USF, I can
assure you we are reforming this \$7 billion program to more clearly
focus on its original purpose of insuring all Americans have access to
communications -- including advanced services. I look forward to moving
toward fundamental reforms and welcome your input to insure the
stability and continuity of the fund while also insuring it supports the
necessary infrastructure for broadband to flourish, even in remote and
insular areas.

\(6\) Finally, as you have suggested, the Commission is taking action to
obtain more granular information about broadband deployment. Just last
month, we adopted an order that will help us collect significantly
better data on the deployment of broadband services across the country.
I also appreciate and encourage private, state and local efforts to
enhance the availability of such information. As one example, the
moderator of a previous panel, Drew Clark, has established a new
website, BroadbandCensus.com. This website encourages consumers to input
data on which broadband providers serve their particular area, lets them
test download and upload speeds, and then makes this data available to
other consumers. This is precisely the type of empowerment and education
that benefits consumers, often more effectively than government
regulations.

**[Public/Private Partnerships]{.underline}**

As a former state official, I also have been a champion for innovative
public-private partnerships, in areas ranging from economic development
to education to health care. Connect Tennessee is a great example of
just such a venture, which is focused on promoting broadband in my home
state of Tennessee, a state with a significant rural population. Connect
Tennessee coordinates with governments, communities, businesses, and
service providers to identify supply and demand conditions and tailor
services to unmet needs. The program identifies barriers to consumer
adoption where broadband exists and applies GIS mapping to identify
areas where there is no broadband service, as well as where people live
and businesses are located. It then helps establish a "business case"
scenario to build out broadband. This program is patterned after the
successful Connect Kentucky program which, in a few short years, has
built out broadband networks that provide access to 95 percent of
Kentucky's population, and Tennessee hopes to do the same by 2010.

When something works, we should encourage others replicate it. Thus, a
national Connected Nation has emerged from the successful model of
Connect Kentucky, with projects that include not only Tennessee, but
also Ohio, South Carolina, and West Virginia. All of these states have
significant rural populations, which makes broadband deployment a
challenge. But our rural and less-populated states and regions should
not be left off the Information Super Highway, and thanks to innovative
thinking by groups such a Connected Nation, it looks like they won't be.

**[Private Sector and Policy]{.underline}**

As industry leaders, I ask for your input on what policymakers should do
-- and perhaps even more importantly, what we should [not]{.underline}
do -- recognizing that staying out of the way is sometimes the wisest
course of action for government. We must choose a path that is carefully
balanced, providing the appropriate regulatory relief which resolves a
specific "harm," allowing networks and carriers to respond to
marketplace demands efficiently and effectively, ensuring that consumers
are informed and protected and competition is encouraged through the
least intrusive and least costly regulatory action.

Finally, because so many of you are network providers, I want to
recognize the important role you play in network management. Earlier
this month I was at Stanford University as part of a Commission hearing
on network management, and in February the Commission held a hearing at
Harvard University on the same issue. The question that is being asked
-- and it should be asked -- is what is "reasonable network management."
All network providers recognize that, with the widespread deployment of
broadband, the type and level of Internet traffic is changing
dramatically. One researcher recently reported that in December 2007 a
record 10 billion videos were viewed online. The largest U.S. broadband
provider says consumer broadband traffic on its network has doubled in
the last two years alone, and broadband customers are using 40% more
bandwidth per year. One report estimates that the amount of information
transmitted across the Internet in the U.S. will be 50 times larger by
2015, equal to 50 million Libraries of Congress. Building faster pipes
will be important, but this alone may not be sufficient. Even in Japan,
where network speeds reach 100 mbps, congestion is a concern.

As usage increases exponentially, the need for reasonable network
management becomes clear. At the same time, such reasonable network
management should be consistent with the Commission's four principles of
network neutrality, adopted in 2005. These principles state that
consumers are entitled (1) to access the [lawful]{.underline} Internet
content of their choice; (2) to run applications and use services of
their choice, subject to the needs of law enforcement; (3) to connect
their choice of [legal]{.underline} devices that do not harm the
network; and (4) to competition among network providers, application and
service providers, and content providers. From the inception, the
Commission made it clear that these principles were subject to
reasonable network management.

We again should be clear that we are talking about [legal]{.underline}
content and applications. While the good news is that widespread
deployment of new technologies, including peer-to-peer applications,
holds tremendous promise to allow networks to run more efficiently, the
bad news is that, like any tool or technology, it can also be misused. I
am particularly concerned with the ability of new technologies to
promote some of the most harmful threats online -- child pornography,
piracy, and privacy violations.

**[Voice for Children]{.underline}**

Since arriving at the Commission, I have tried to be a strong and
consistent voice arguing on behalf of children and families, and arguing
against the increasing level of coarseness and indecent programming, as
well as the negative impact of unhealthy food advertisements on the
epidemic of childhood obesity. For those of you in the content arena, I
call on you to be part of the solution, using broadband to educate our
children, not just to entertain them. I am very pleased that, at the
multi-national level, much is occurring regarding the protection of our
personal information -- information about where we go and what we do, as
well as personal financial and health-related data -- and more
importantly, the protection of our children. The International
Telecommunication Union, the first lady of Egypt, the APEC ministerial
meetings -- all are raising the dialogue to a global level. Throughout
all of our societies, we recognize our children are our greatest natural
resource.

Today, of course, I hope to raise your awareness of this issue of
protecting our children in the on-line world. I encourage all of you to
adopt policies and provide tools in order for parents and caregivers to
be able to provide a safe environment in the online world as well as the
offline one. I continue to be concerned about the amount and type of
illegal and dangerous online activities, which put our children in
harm's way, and the digital generation gap by which parents don't even
know all of the capabilities as well as the risks the Internet entails.

With regard to piracy, I'm from Nashville -- Music City, USA -- and so I
see first-hand the effects of illegal use. Two-thirds of the 20 billion
illegal downloads worldwide each year are of U.S. recorded music. We've
suffered \$203 million in lost earnings due to piracy in Tennessee
alone. For the country as a whole, the U.S. Chamber estimates piracy
costs our economy \$12.5 billion dollars each year, including negatively
impacting research and development in pharmaceuticals and software and
more, as well as the impact on thousands of Americans who are our
nation's -- indeed the world's -- songwriters and storytellers.

**[Conclusion]{.underline}**

In closing, I want to thank you again, not only for the opportunity to
speak with you today, but for the important work you do every day. As I
hope I've made clear, the deployment of broadband is critical for our
economic well-being, and for the numerous opportunities it creates in
terms of education, healthcare, virtual jobs, and our multi-national
competitiveness.

While policymakers have the ability to make rules that impact broadband
deployment, we need to listen carefully to those who actually develop,
invest in and [deploy]{.underline} the service -- that is, all of you,
so please stay involved in these issues. For broadband, it is especially
important that we get the policies right, to ensure that our children
are protected, our citizens are connected, and our country is
competitive for generations to come.