On Thursday, March 22, the FCC is expected to vote on a proposal that would reduce the burden of federal regulation on siting of small cells. By reducing the cost of installing small cells, which are barely visible backpack-size units (in contrast to the large towers of yore), the proposal—if adopted—could dramatically improve access to high-speed broadband Internet, especially in rural areas.
During the winter storms that hit the northeast three weeks ago, our fiber optic Internet connection was knocked out —and remained out for nearly two weeks. Suddenly we were forced to rely on 4G cellular connections and the kindness of friends whose fixed-line Internet connections had not been affected. It was a stark reminder of just how much we have become reliant on broadband: for phones, for streaming content, and, most importantly, for work. It was also a reminder of the importance of innovation —and the potential benefits of enabling the deployment of higher bandwidth cellular data connections.
A 2012 study found that increased access to broadband leads to higher rates of economic growth, especially in rural areas. Studies also show that enhanced broadband access in rural areas can improve access to telemedicine and thereby improve health. And among the many other benefits of improved broadband coverage is enhanced access to online education, which can reduce tuition costs and is particularly important in rural areas. But wider coverage of higher speed wireless Internet would benefit everyone and would speed up implementation of the Internet of Things and autonomous vehicles.
Our family is fortunate to live in a relatively densely populated area that has multiple broadband providers offering high-speed connections to the Internet. The good news is that our situation is increasingly common. According to the latest report from the FCC, the proportion of homes with access to fixed line connections with download speeds of 25 MB/s or more grew from 33 percent in 2013 to 60 percent in 2016. Over the same period, the proportion of homes with fixed-line connections of less than 10 MB/s fell from 10 percent to below 4 percent. Moreover, homes in 82 percent of census blocks had access to at least two competing providers supplying fixed line Internet access at 10MB/s or greater.
The bad news is that a significant number of homes and businesses in more rural areas must currently make do with slower Internet speeds. But that could change with the roll-out of 5G cellular data services. Recent tests found that 5G offered median speeds of 1.4GB/s – that’s 20 times faster than current 4G connections.
New small cells are likely to bring down the cost of rolling out 5G. Compared to traditional cell towers, these lower powered small cells are much less expensive. They are also relatively unobtrusive and can be installed on existing structures such as street lights and power line poles. By increasing broadband access and competition, widespread installation of 5G using small cells could dramatically improve the lives of people living in rural areas.
However, under existing federal rules, small cells are subject to the same federal historic and environmental review process as larger cell towers. Those reviews, which are on top of any state and/or local requirements, delay and drive up the cost of installing small cells. A recent study found that the average cost of installing a small cell is $36,000, of which about $9,730, or 29 percent, is due to the cost of the review process. Yet, in 99.67 percent of cases, the reviews have not changed planned developments. In short, the reviews are expensive and pointless.
Even with small cells, rolling out 5G will be expensive—and cellular providers will only install cells in locations that are likely to be profitable. By dramatically driving up the cost of installation, existing mandatory federal historic and environmental reviews reduce the profitability of new small cells. Since profitability is likely to be lower in more rural locations, these reviews effectively reduce rural access to high-speed wireless broadband.
To address this problem, FCC Commissioner Brendan Carr has proposed removing the requirement for reviewing new small cell installations under the National Historic Preservation Act and the National Environmental Policy Act. If the FCC votes on March 22 to approve the proposal, the average cost of such small cell installations would effectively be reduced by 29 percent. That would almost certainly increase the pace of rollout of 5G, benefitting especially rural customers who currently have slower internet connections. It would also likely reduce its costs to consumers.