An interview with the man who understands the connection between wireless and economic growth.
In his short time as a Federal Communications Commission commissioner, Brendan Carr has quickly become the leader in wireless policy, pushing the FCC to adopt more streamlined regulations that should enable the United States to be the leader in 5G growth and adoption. He recently chatted with the Taxpayers Protection Alliance Foundation about how the new FCC order will help that effort, and other ways the commission can help close the broadband divide to improve economic development.
Give us a brief background on yourself and your time at the FCC.
I actually joined the commission as a staffer back in 2012, and then after a year and a half moved over to work for Commissioner [Ajit] Pai as his lead adviser for wireless, public safety and international issues, and then he was made chairman in January 2017. I was put in as the general counsel for the commission and did that for about eight months before I was nominated by the president and ultimately confirmed by the Senate to be one of the five commissioners who help run the agency.
What is your philosophy about the role of the FCC in promoting economic development?
I think there’s a tremendous opportunity with tech and telecom policy to promote policies that are going to create jobs, that are going to grow the economy and that are going to spur greater investment in this space. That’s really the overarching lens through which I view everything I do at the commission as to how is this going to help create jobs. A big part of that is broadband deployment. Everything from the manufacturing plant that makes the broadband fiber to the good-paying construction jobs that deploy the fiber to the economic opportunity that comes once you as a consumer or small business gets the online connection. And we’ve got to travel around the country and see where and how broadband deployment means economic opportunity for Americans. It’s good to get outside D.C. and meet the people who hopefully will benefit from your policies. It gives you a different perspective to get outside the Beltway and see what’s jamming people up in broadband deployment. What are the real on-the-ground obstacles that they’re facing and how can we help remove them here at the FCC?
Now that the 5G order is in place that will help streamline and reduce regulations to aid small-cell deployment, what is the next step to aid the growth of 5G?
Stepping back, 5G is going to be the next generation of wireless service. A lot of consumers right now have what is known as 4G. 5G is going to be a couple of things — it’s going to be faster and will have lower latency. What does that mean? A lot of things you think of now as cutting-edge innovations, whether that’s autonomous cars, the Internet of Things, precision agriculture — in order for that to be enabled and made available to the masses we have to upgrade our networks. And that’s really what 5G is about. How do we get our networks upgraded to 5G so they can support this next generation of innovation? Doing this also has a tremendous economic benefit. It’s estimated that it will cost $275 billion to deploy 5G networks, but doing that will create 3 million new jobs and will add half a trillion to GDP. The hurdle we’ve been facing in trying to get there in large measure has been one of regulatory red tape. That’s why this order was so important. What 5G means in many respects is the increase in the number of deployment of cell sites, but 80 percent of those new deployments will be what we call small cells, which is very different from those 100-foot, 200-foot towers that marked previous generations of wireless deployment. But our regulatory regimes assume that every new cell site is a 100-foot, 200-foot tower. We needed to update our approach, which we did in our recent order. That’s going to make a big difference in terms of helping us get 5G across the finish line.
What can the FCC do to encourage state and local authorities to ease regulations at those levels that inhibit 5G growth?
This is another piece of the equation — state and local laws. At the end of the day state and local zoning authorities play a big role. They’re the ones that review individual cell-site deployments. We don’t actually play that role at the FCC in terms of giving a thumbs-up or thumbs-down on particular deployments. Some states are moving forward in forward-thinking ways with some state-level small-cell bills. Texas is one of those that has made it easier to deploy small cells. Other states aren’t taking that same approach. There are a couple of steps we need to take at the commission. One of those is using the bully pulpit and talking about the economic opportunity that will come to communities that get their regulatory structures 5G ready. And we also have decisions that Congress made in the Telecommunications Act in terms of making sure there aren’t state and local barriers to the deployment of 5G.
How can the FCC work to ensure there is not an urban-rural divide when it comes to the rollout of 5G?
This is a big deal. In my mind, it’s not a success if we see 5G just deployed in New York or San Francisco. I want to see 5G deployed as ubiquitously as possible and that’s part of why it was so important we took that effort to streamline regulatory red tape. Thirty percent of the total cost of deploying these small cells had been eaten up by this federal regulatory review, so by cutting that cost, which we did last month, that flips the business case for thousands of communities. So communities that wouldn’t have been profitable for a carrier to deploy 5G to now becomes economical. They’re now hopefully going to see 5G because we’ve made a different business case. At the same time, there will be communities where cutting red tape isn’t going to be enough because of high costs of service, and we also have a federal universal service program that puts money towards helping to make the business case to deploying in those high-costs areas. So it’s going to require action on all of those fronts.
There is still a lot of movement to increase taxpayer funding for wireline internet, whether through Trump’s infrastructure proposal or a recent FCC order calling for more money for the Universal Service Fund’s rural broadband funding program. Are there concerns that some of this could be money wasted as we transition from fiber to wireless?
We’ve got to make these decisions in a wise and prudent manner, that, yes, spending money to cover deployment is an important thing we’re doing, but we also have to understand the impact that has on consumers that are paying ultimately, and in the case of the Universal Service Fund directly into the fund. So we are right now in the process of trying to reorient a lot of our programs to make sure that they focus on unserved areas, and we’re opening up a new reverse auction, which is one way we distribute these federal universal service dollars for mobile and for fixed offerings. And we’re actually allowing different technologies to compete. So we’re not providing support solely to wireline deployments. We’re opening up for the first time the ability to get universal service dollars to fixed wireless providers. We have a mobility fund that provides funding to traditional mobile cellular wireless providers, so at the end of the day we’re trying to approach this from as agnostic position as we can from a technology perspective, while also understanding there is some difference between fiber in terms of speed and latency than other types of technologies.
How do you envision that the auctioning of spectrum will work in conjunction with small-cell deployment for broadband growth?
It’s a key piece of it. The game plan that we used to lead the world in 4G was two-fold: opening up spectrum — auctioning it off — and then the second piece of it was on the infrastructure side making it easier to deploy the antennae that used that spectrum. That is the game plan we need to deploy going forward. We’re looking at large swaths of spectrum, frankly spectrum that not too long ago people didn’t think was technically usable for mobile wireless. We’re opening that spectrum up to make sure there’s another capacity to support these new 5G use cases and we’re going to conduct our first auction of that spectrum later this year. So we’re in good shape in terms of finding spectrum bands and auctioning them off.
Do you think the removal of the Title II designation for internet service providers will aid in broadband growth — both fiber and wireless?
Absolutely. When the commission adopted the unprecedented decision in 2015 during the Obama-era FCC to impose this heavy-handed Title II regime those decisions have consequences and we saw that investment by broadband providers was declining during the period in which that Title II regime was imposed. There was a lot of focus during the debate on the impact on the biggest providers — AT&T, Comcast, Verizon — but what we were also seeing were some of the smallest broadband providers, the ones that serve rural America — they’re often the only competitive provider in a community — were particularly hard hit by these Title II regulations because they didn’t have the army of regulatory lawyers to work through it. So we saw providers that were pulling back on deployment, pulling back on investment. So, yes, I think in reversing that Title II decision consumers will continue to be protected, but we’re going to see increased investment going forward. I think that’s going to be a great thing for consumers.
One of your main talking points is how regulatory relief was needed so that the United States would lead the world in 5G development. Do you feel the country will be able to lead the charge now that the FCC order is approved?
Countries around the world want to lead in 5G. They saw the U.S. leadership in 4G and they want to try to beat us to the punch in 5G, whether it’s Europe, countries in South America, Korea, Japan. They’re all moving very aggressively, both on a spectrum and infrastructure front to get the lead in 5G. I’ve been in touch with our regulatory counterparts in Europe and they’re looking at the exact same actions that we’re looking at — excluding small cells and streamlining the approach for large cells. But we’re moving quickly in the U.S. and think that’s a great sign for our leadership.
What is your vision of when 5G can be deployed on a large scale basis?
A lot of people throw the number 2020 out there. We already have a few trials that are ongoing. In terms of a tipping point I think it’s going to take a couple of years after 2020. I think I saw some estimate that showed 2023 being a big turning point between 4G subscriptions and 5G subscriptions so it’s going to take a little bit of time still, but in terms of the legwork that needs to be done from a regulatory perspective the time is now.
Johnny Kampis is investigative reporter for the Taxpayers Protection Alliance Foundation.
Photo: FCC Commissioner Brendan Carr at CPAC on Feb. 23 (Gage Skidmore/Creative Commons)