A huge technological transformation is underway in the U.S. and around the globe: Consumers are abandoning older technologies in favor of high-speed Internet services that rely on modern, fiber-based or IP-enabled broadband networks. As consumer demand skyrockets, it becomes more and more imperative to upgrade the old public switched telephone lines to high-speed IP-enabled broadband networks.
Telecom carriers, cable companies and satellite providers are investing billions to deploy and upgrade broadband networks across the country to meet burgeoning consumer demand. This commitment will lead to the replacement of old copper telephone lines and connecting communities to next-generation high-speed wired and wireless broadband networks. These new networks can dramatically enhance a consumer's communications experience by offering video and Internet access in addition to voice.
For creators in particular, the transition to IP-based networks holds enormous promise. It has the potential to expand creators' customer base and ultimately offer new apps and services to consumers and businesses in the digital age.
The FCC Should Provide Incentives to Speed Broadband Conversion
Only by converting outdated copper telephone lines to high-speed broadband networks can we be sure that the technology infrastructure is in place to make programing and broadband services available to all U.S. households. When the dust settles on this massive investment, copper telephone lines connecting a phone in one place to a phone in another place will be replaced with robust networks that connect people, businesses, schools and others through both wireline and wireless broadband devices for the benefit of our creative economy and global competitiveness.
However, an uncertain regulatory environment is slowing investment in the transition to all IP-enabled networks. Currently, incumbent telephone companies are required to maintain the current copper wireline services despite the fact that less than one-third of American households continue to rely on the traditional wireline telephone as their primary means of communications.
This obligation diverts investment from where it is most needed to roll out the IP conversion. The FCC should correct this regulatory anachronism. Rather than sustaining an outmoded system, the FCC should provide incentives to encourage the massive investment needed to expand broadband networks. The migration of tens of millions of US consumers to Voice over Internet Protocol (VoIP) services such as Vonage and/or to wireless demonstrates the clear need for federal regulators to catch up with the times. Creators, too, will benefit from the improved wireless and wireline services that an expanded IP network infrastructure will provide.
Broadband Conversion Will Grow the Market
Roughly one-third of U.S. households currently lack access to the wired broadband infrastructure. Connecting these households to IP networks could dramatically expand the audience for content and programming.
Looking at the demographics of these consumers who lack access to broadband and instead may rely on POTS lines or Lifeline, it seems unlikely that they currently connect to "over the top" programming now and may lack access to services beyond basic cable. These users, therefore, represent a potential new customer base for programming services in a new IP network environment.
However, creators' ability to reach these potential consumers with compelling original programming -- new music video outlets, the next House of Cards, or video on demand -- is currently constrained by the regulatory requirements forcing incumbent carriers to maintain antiquated copper-based telephone lines. Instead regulators should encourage providers to not only replace old communications networks with new IP-based technology, but also to make the long-term investments in high-speed wired broadband service that will connect more Americans in their homes.
Efforts to accelerate the IP transition nationwide are under consideration at the FCC. Now is the time for creators to engage in this policy conversation to secure the benefits of IP for consumers, businesses and our country as a whole.