Federal regulators detailed a $20 billion, 10-year plan to ensure all U.S. households access to high-speed Internet service, but the proposal faces resistance from industry groups and possible questions from lawmakers over how to pay for it.
The Federal Communications Commission is expected to formally release its strategy Tuesday to bring high-speed Internet access to the seven million U.S. homes that lack it, while making existing broadband connections that serve some 100 million households at least 10 times as fast. The plan is designed to encourage more Americans to go online through new proposals like a free or low-cost national wireless broadband network.
But for the telecommunications industry and its critics, the more important aspects of the plan will have to do with how the FCC could soon propose to use its regulatory powers to generate more competition for the existing broadband networks run by big phone and cable companies.
Consumer groups have been pressing the agency to propose rules that would require companies to open up their networks to rivals. But the plan doesn't specifically call for broadband providers to share their networks under so-called open-access rules, a win for the telecommunications industry.
"A lot of the hardest questions have been moved down the road," said Ben Scott, policy director of Free Press, a public-interest group. "How will we get those higher broadband speeds and how will we get lower prices?"
The other critical issue for the broadband and Internet industries will be how the agency and Congress propose to auction off unused airwaves—electromagnetic real estate valued at billions of dollars.
Aides to Federal Communications Commission Chairman Julius Genachowski privately briefed industry lobbyists and consumer groups about parts of the plan over the past few weeks, including details about how the FCC proposes overhauling a $8 billion federal subsidy phone program to cover expanding Internet service to poorly served areas, according to people familiar with the discussions. Agency officials asked companies and industry groups to say positive things about the broader plan, according to some people who received the requests.
The private briefings could raise questions about whether the agency has offered special access to business interests, but the FCC said all groups have had input in shaping the proposal.
"We have kept an open line of communications with all stakeholders throughout the broadband plan process," an FCC spokeswoman said in a statement.
Many of Mr. Genachowski's recommendations could be politically difficult to enact, however, and the FCC plan barely mentions a controversial proposal that officials are considering to impose more regulations on Internet lines.
Industry lobbyists vigorously pushed back against the idea of more regulation and are expected to fight any future efforts as well.
"We are concerned about increasing regulation on things that don't need to be regulated. Don't fix something that's not broken," said Jeff Campbell, senior director of technology and trade policy at Cisco Systems Inc., who offered a generally positive view of the plan.
Meanwhile, broadcasters face the prospect of paying a new government fee under the plan for use of airwaves. Television station owners currently don't pay an annual fee to the FCC. The plan also calls for recovering and auctioning off about 20 television channels' worth of airwaves from TV broadcasters.
"We are concerned by reports today that suggest many aspects of the plan may in fact not be as voluntary as originally promised," said Dennis Wharton, a National Association of Broadcasters spokesman.
The FCC plan proposes more than $20 billion in new government spending, including $12 billion to $16 billion for a new wireless network for police and firefighters and "a few billion dollars per year over two or three years" for broadband lines in rural areas.
FCC officials say their plan is "revenue-neutral" because the proposed federal spending will be offset by proceeds from future airwaves auctions. The FCC's last airwaves auction in 2008 raised almost $20 billion.
But Congress, not the FCC, decides how to spend money raised in spectrum auctions and lawmakers have historically used the money for deficit reduction or to offset other spending. It isn't clear if lawmakers will agree with the FCC on how to spend proceeds from future auctions.
"Certainly, the $16 billion for public safety would enjoy bipartisan support," predicted Rep. Rick Boucher (D., Va.), chairman of the House subcommittee on Communications, Technology and the Internet, which plans to hold a hearing on the report on March 25.
Printed in The Wall Street Journal, page A8
The United States Federal Communications Commission released a plan to provide broadband Internet access to at least 90% of the American population today, and sent a copy of the plan to Congress, which will consider whether to introduce legislation to enact portions of the proposal. Other parts will be decided on by various government agencies.

The plan is intended to spur adoption of broadband Internet in the US by extending broadband access to areas of the country, such as rural areas, that do not currently have such access, as well as substantially increasing the speed of existing broadband installations.  Currently, only around 65% of American households have broadband connectivity; if approved, the new plan would increase that number to 90% by 2020.  According to a statement from the FCC, the plan would provide a "foundation for economic growth, job creation, global competitiveness and a better way of life."

Opposition to the plan is largely based on two points, which are cost, estimated be as much as $350 billion, and the effect on current users of airwaves, which new broadband access would use.  According to the FCC, the plan would end up being revenue-neutral, thanks to income from the auctioning of airwaves, although in past such auctions revenue has gone to the US government. Separately, the proposal would include some changes to regulations over Internet lines, which are largely opposed by the industry, as well as plans to introduce a new fee for use of the airwaves, which are currently untaxed.