The world’s largest economies are aggressively modernizing their Internet infrastructure with universal fiber to-the-home plans or have already achieved that metric—with the exception of the United States. EFF noted that there is a desperate need for a federal “Fiber for All” plan that tackles this national problem. But the same can be said about the state of California, the country’s largest state economy, which ranks on its own as the fifth largest economy of the world.
In fact, as of 2012, the California legislature decided to eliminate the authority of its own telecom regulator, the California Public Utilities Commission (CPUC) through the end of 2019—on the promise that such a move would produce an affordable, widely available, high-speed broadband networks.
That never happened.
Despite that fact, AT&T and Comcast lobbyists are close to convincing the state legislature to renew that law with Assembly Member Lorena Gonzalez’s A.B. 1366. EFF remains strongly opposed to the legislation. We have detailed to the legislature the extent to which Californians face a monopoly for the future of broadband access per the government’s own data. If this legislature listens to AT&T and Comcast by backing this bill, it will risk dropping California further behind the rest of the world's major economic powers as they build affordable high-speed broadband.
Don't Let the Legislature extend Broadband Monopolies
Most Californians Face Expensive Local Monopolies or No Access at All
Major ISPs argue that less regulatory oversight allows market forces to promote universally available, affordable, and competitive high capacity networks. But that hasn’t been proven true anywhere on planet Earth. When ISPs are left completely to their own devices, they tend to focus on the easiest-to-serve customers rather than try to reach everyone. That leaves most people with high-speed broadband as a monopoly—or no choice at all—per the government’s own data. California’s own broadband picture is abysmal. Data shows a vast majority of Californians are facing a monopoly when it comes to high-speed broadband access ready for the future. This is because only small ISPs and local governments are building fiber to the home while the large statewide telecom companies like AT&T have opted to avoid competing with Comcast. That leaves Californians worse off than in 2012, the year the state deregulated broadband companies, when most people had at least two viable competitive choices.
And it is not like the big ISPs are hard up for capital to invest. They in fact received billions in new capital after federal tax cuts. Rather than systemically replacing their legacy networks with fiber, they ended up buying back stocks. And ISPs have, for years, prioritized mergers and acquisitions over investment in the future—leaving AT&T and Comcast the most indebted companies in the world. If we stick with the current approach to broadband access, there is no reason to expect that the current trajectory of the state’s market into local monopolies will change.
What Are California’s International Competitors Doing on Broadband?
Other major global economies with the same goal of universal fiber access rely on an expert regulatory agency to study the barriers—and use its power to knock them down. California, has long denied itself the power to follow suit by enacting Public Utilities Code 710 in 2012 at the behest of the major ISPs. That’s left most California residents stuck with cable monopolies or old, degrading telephone infrastructure. When we compare California’s inaction to other major economic powers, the state’s telecom policy looks down right backwards.
Larger economies such as Japan replaced their entire telecom networks with fiber years ago, and sell symmetrical gigabit broadband services for around $50 a month. For comparison, Californians in monopoly markets, on average, pay between 200% to 300% that rate ($159.99 in San Jose, $159.95 in Antioch, or $100 in Los Angeles for example) for slower speeds, which also mirrors the national story. Furthermore, when a country has ubiquitous fiber, it can quickly upgrade to faster speeds on the cheap—and can be leveraged for speedy 5G highspeed wireless deployments. For example, South Korea took just two months to hit 1 million 5G users because the entire country is already wired with fiber optics. The UK, which has a smaller economy than California, recognized last year that their telecom networks were not where they should be and adopted the bold vision of connecting 15 million new homes to fiber by 2025. It aims to have universal coverage by 2033.
France, which was underperforming on fiber deployment when compared to its EU peers, empowered its regulator to leverage its authority to push the ISPs to commit to near universal transition to fiber optics and invested billions in public dollars in infrastructure. Now the major ISPs there have committed to a near-universal transition to fiber networks in just a few years. France’s largest ISP, Orange, is reaching for 92% fiber-to-the-home coverage by next year. Smaller economies such as Lithuania, Portugal, Latvia, and Spain already exceed 70 percent fiber to the home coverage (California is less than 20 percent—with most of the action around San Francisco). The consistent theme here is none of these countries reached these metrics without a plan executed by an expert agency empowered to address competition and universal access.
Stop A.B. 1366 and Demand That California Adopt an Ambitious Fiber Plan
There is no good reason why a vast majority of Californians can’t get access to fiber networks at an affordable price. It will take work and experts to study the market’s shortfalls and to remedy them. But California has a lot of case studies of successful approaches around the world—even from other states. In Utah, people have 11 choices for gigabit fiber services through an open access fiber network built by local governments. North Dakota has already reached 60 percent fiber-to-the-home due to aggressive local investments.
California has historically been a leader in broadband policy; it opened up the telecom market to local competition, eventually prompting the landscape-changing federal Telecommunications Act of 1996. But it will not regain that position if we allow the California legislature to pass this AT&T- and Comcast-backed bill in the coming weeks. Contact your state Senator and ask them to vote No on A.B. 1366. Tell them Californians deserve not only the same broadband options and standards enjoyed by the rest of the country, and the rest of the world, but also for their state to be a global leader.
