Homeowner's Blog

Should the Internet be Regulated?

Up until a recent court decision it was assumed that the Federal Communications Commission had the necessary authority to make sure consumers had the right to access legal websites and use legal applications. The FCC has needed to use that power only rarely, and consumers have enjoyed the benefits of this "network neutrality". The recent court decision was that in fact Congress had never granted the FCC such authority. FCC Chairman Genachowski has proposed an alternative approach, and has also promised that, if it is approved, the FCC will continue to use the same light regulatory hand that it has always used. Opponents of his proposal fear that it goes too far, creating the potential of regulations that could have detrimental side effects.

We believe that there must be a mutually acceptable middle ground somewhere in this debate. The telecoms all say they continue to support network neutrality, but are concerned that some future FCC may not adhere to its light regulatory approach. The companies claim that the Internet were to be heavily regulated, it could undermine continued private investment that is critical to achieve universal broadband availability. This is a credible argument - infrastructure  investment in this sector continues to be impressive despite middling profit levels, and continued federal budget realities are such that universal broadband availability will not be achieved anytime soon without that investment. With these factors in mind it would seem that there must be some formula that would give the FCC just enough authority to protect maintain network neutrality should some company violate Network Neutrality principles in the future, but not so much authority that investors or consumers need fear that private sector investment might be threatened by a heavy-handed regulatory approach by a future FCC.

A Plan to Provide Broadband to all Americans

Many rural and other homeowners either do not have access to broadband or don't have Internet access at fast enough speeds and affordable costs to support home-based businesses or sophisticated healthcare applications that would allow them to remain in their homes instead of moving to nursing facilities. Chairman Genachowski  and the staff of the Federal Communications Commission have developed a proposed National Broadband Plan for dramatically improving broadband networks and extending their benefits to all Americans. In terms of the practical impact of technology on the daily lives of most Americans, this effort far surpasses the importance of the space program other technology-related areas. As Chairman Genachowski noted, "The starting point to solve these problems is a set of goals that are ambitious but achievable with a national commitment."

The proposed National Broadband Plan is the first step to reaching a common agreement on the specifics and priorities of those goals. Once we reach a consensus on the goals, we will face significant challenges regarding the mechanics of its implementation. Those challenges will involve complicated decisions between alternative ways to achieve the nation's broadband goals. Policymakers will have to make those tough choices, but the Plan is the critical precursor to the day when all American homeowners and other consumers can fully realize the benefits of broadband.

Chairman Genachowski  and the staff of the Federal Communications Commission deserve our thanks for taking this first step.

Homeowners to FCC: Continue to Preserve the Open Internet

The importance of an open Internet to economic opportunities and the wellbeing of homeowners and other consumers grows every day. It is important for commerce, education, healthcare, and provides many other opportunities, such as the ability to work from home. Homeowners are fortunate in that the Federal Communications Commission has done a very good job of assuring that the providers of the networks used by consumers to access the Internet continue to be open and neutral.

The way in which we access the Internet is also changing. The four principles of network neutrality, which guide the FCC's efforts to preserve an open Internet, were written at a time when most of us accessed the Internet from our homes or offices. Today mobile access is becoming much more important, and the FCC is modifying its rules to address this new environment. The American Homeowners Grassroots Alliance supports that exercise. In our January 14 FCC submission we thanked the commission for their commendable performance and urged a similar approach to the new environment and the issues that arise from it.

We also urged the FCC to collaborate with the U.S. Department of Justice and the Federal Trade Commission to address some serious antitrust challenges that are outside of the scope of the current inquiry. The nation's national online network of homes for sale has faced repeated efforts to deny home sellers the services of discount real estate brokers who provide sales assistance at a fraction of the typical 5-6% real estate commission. Currently about 90% of home buyers search for homes on that consumer-facing online network, so it's imperative for home sellers to get exposure on that network. If they are denied access to that network because they prefer to use a discount real estate broker, an owner of a $200,000 home might be forced to pay a $10,000 - 12,000 real estate commission instead of a few hundred dollars a discount broker would charge.

The Federal Trade Commission has taken the lead on addressing this challenge and has initiated efforts to stop the efforts of numerous local Multiple Listing Services (MLSs) across the country who have sought to limit home sellers access to their networks through discount brokerage services. The FTC has been successful in the ongoing series of cases, although one MLS is now appealing the initial FTC finding against it.

Federal competition laws or regulations must be strengthened in order to more effectively discourage dominant private Internet commerce networks and search firms from engaging in such actions. In our comments AHGA urged the FCC to support such changes.

Providing Universal Broadband  to all American Homeowners

On February 29 Federal Communications Commission Chairman Julius Genachowski said that bringing basic broadband Internet service to American households without access could cost as much as $20 billion This will be expensive, but the penalty paid by Americans who do not have broadband access grows every day. They don't have the growing number of educational, economic, healthcare, or many other options available to those who do, and they are destined to becoming even  more disadvantaged over time as the digital divide widens. Devising the most cost-effective way to bring broadband Internet service to the three million to six million American households without access is by far the most important priority for U.S telecom policy today.

The immediate challenge is spending the $7.4 billion in broadband economic stimulus funding efficiently, since that process is already underway. The goal here is universal broadband availability and there are several common sense conclusions:

• Spend all of the money on deploying broadband to areas that do not have it now, and are not in the path of private broadband build-out for the next few years.

• Rely on temporary subsidies to help those who have broadband services available to them but can't afford them. As competition evolves, available speeds and choices will increase, prices, will  drop and many subsidies can be cut back.  

• Tap the $7 billion federal fund that subsidizes phone services in rural areas and for low-income Americans. The use of land lines is declining as both broadband and cell phone use (and mobile computing) is increasing. There is no longer any point in subsidizing a rural telephone company's land line expenses where mobile voice/computing service is available, so subsidize the latter. Rural telephone companies have the choice between morphing into broadband solution providers or else becoming the 21st century's buggy whip manufacturers.

• It is worth investing reasonable amounts in efforts to try to improve adoption rates, but important to recognize that they will increase organically anyway as more technology oriented generations succeed their elders.

Agencies in charge of distributing the funds will have to make subjective decisions in many cases on whether to spend the same amount of  money on higher speed broadband to fewer unserved or slower speed broadband to more of the unserved. They will get criticized even when they make the right decisions. It is inevitable that in any major ramp-up of this magnitude that some bad choices will be made as well. The most that we can expect, but what we all have a right to expect, is that the FCC and other organizations involved in the path to universal broadband availability keep their eyes on the ball, be willing to admit mistakes, learn and improve as they go, and continue their role as universal broadband evangelists until broadband is available to every home in America. So long as they are doing a reasonable job of it, the rest of us also need to continue to stand up for the importance of achieving universal broadband availability, and support the FCC and other involved agencies in this critical mission.

The $7.4 billion in broadband economic stimulus funding alone is not going to achieve universal funding. The government can't afford to pay for all of the costs anyway. We also need to think about new economic incentives to encourage the private sector to increase its investment in broadband rollout and related areas.

Promotion of Teleworking Should be Top Federal Communications Commission Priority, Says National Homeowners Group

In response to a request for comments from the Federal Communications Commission, we suggested a variety of new policies to promote teleworking. Teleworking incentives will help the environment, homeowners, and businesses. Homeowners are welcoming telework for many reasons. With the dramatic growth in two income families, time-starved parents find that teleworking helps them cope with the many responsibilities of child-rearing. As commuting distances and times lengthen due to suburban sprawl, teleworking also provides a way to recapture precious hours lost to traffic jams. Surveys consistently show that telecommuting programs are among the most popular employee benefits. A recent survey of members of the American Institute of Architects revealed that home offices are the most popular special function room of new home buyers for the third year in a row."

Home-based technology-centric businesses (we call them telehome businesses) benefit society in many ways. Telehome business owners and telecommuters are helping to reduce rush hour traffic jams and defer the need for state and federal transportation infrastructure expansion and maintenance investments. No vehicle gets better mileage during rush hour than one that remains in the driveway. A study by TIAX LLC determined that a full time telecommuter who lives 22 miles from her office would save 320 gallons of gasoline and reduce CO2 emissions by 4.5 to 6 tons per year. The shift to teleworking is thus helping reduce environmental pollution and global warming.
 
Our policy recommendations:

a. Provide federal and state tax credits to encourage teleworking.
 
b. Prohibit state sales taxes on Internet transactions in order to stimulate home-based Internet commerce businesses and reduce driving to shopping malls.
 
c. Reduce the depreciable lifespan of technology products to 2 years. Recordkeeping should also be simplified and liberalized for home offices, and limited personal use of computers, Internet access services, cell phones, etc., should be exempt from taxable liability.

d. Focus the $7 billion+ in stimulus funds allocated for expanding broadband service to unserved areas which will not soon be served by other private/public sector broadband deployments already in process.

e. Focus the $7 billion+ in stimulus funds on rural areas with urban/suburban demographic characteristics, which are good candidates for broadband deployment from an ROI standpoint.
AHGA also recommended several tax incentives to encourage businesses to invest in telecommuting programs and help broadband service providers both strengthen their networks and expand the availability of broadband services in unserved areas. The complete text of the American Homeowners Grassroots Alliance's FCC submission is here.

American Homeowners Give FCC Suggestions On Universal Broadband

The Federal Communications Commission is developing a plan to make broadband Internet access available to every home in America. We think that's a great idea. Broadband is increasingly the delivery mechanism for many critical services and applications. It isn't available in many rural areas, and rural homeowners are deprived the growing number of potential broadband applications as a result. The American Homeowners Grassroots Alliance made a number of suggestions to the FCC to improve the effectiveness of FCC's National Broadband Plan.