NCPA - National Center for Policy Analysis

Spreading Broadband Through Electronic Loop Provisioning

March 11, 2003

Everyone wants high-speed Internet service (broadband) spread across the country. But some believe the only way to roll out broadband rapidly is to abandon the pro-competitive provisions of the Telecommunications Act of 1996 (TA96) and hope that the regional Bell operating companies -- the Baby Bells -- will accelerate broadband investment in a race for profits.

Fortunately, there is a way to expand broadband without undermining local phone competition -- one that would put the Baby Bells and emerging rivals on an equal playing field while minimizing the need for the Baby Bells to provide services to their rivals, says economist Laurence Kotlikoff.

The fix involves using a next-generation, low-cost technology called ELP (electronic loop provisioning).

  • "Loop" refers to the local loop -- the local telephone lines, telephone poles, underground conduits and switches that connect individual users to the outside world.
  • "Provisioning" refers to the cumbersome process that sets up and cross-connects both voice and data circuits electronically.

ELP would give competitors the same access to customers as the Baby Bells now enjoy. There are additional benefits to the technology:

  • It would make it possible to switch customers from one telecom company to another -- or between voice and data services of one company -- with the same speed, cost and reliability as long distance service is now switched.
  • ELP can deliver broadband speeds 30 to 100 times faster than current rates.
  • It would lay the groundwork for video streaming and other applications.

Much of the infrastructure for ELP is either in place or slated to be installed. Using these resources, which requires Baby Bell participation and cooperation, would greatly reduce the cost of implementing ELP.

Source: Laurence J. Kotlikoff, "Breaking the Logjam: A Technological Fix," Milken Institute Review, First Quarter 2003, Milken Institute.

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