Friday, October 24, 2014

Speak Your Piece: Keep Funding Connectivity

08/16/2012

broadband in Foster County ND Holly Utke/Dakota Central Telecommunications Dakota Central Telecommunications laid fiber in Foster County, ND, providing high-speed connections to the web for farms and ranches. Such investment in rural tech has relied on the Universal Service Fund.

Most of us never think twice before making a call, sending an email or browsing the web. These are easy conveniences to take for granted.

But for rural Americans, the ability to engage in those tasks often involves many hidden challenges. Historically, because serving rural customers entailed higher costs, larger communications providers and manufacturers focused on urban centers, relegating rural markets to the bottom of their to-do lists.

Fortunately, through the years hundreds of small rural community-based communications providers with tremendous entrepreneurial spirit evolved to fill these gaps.  These small providers, acting as carriers of last resort, have demonstrated a commitment to building networks under difficult circumstances and offering quality services across wide swaths of rural America at affordable rates.  But they could not accomplish these significant works without federally mandated cost-recovery tools such as the Universal Service Fund (USF), which helps to offset the high cost of deploying modern technologies in our country’s most sparsely populated areas.

The USF program reflects a recognition by Congress that our nation can prosper only when all parts of America stay connected. The program allows the rural areas that produce much of our nation’s food and most of its energy resources to be connected with urban markets and consumers, and allows residents in rural areas to engage in distance learning, telemedicine, and the other activities that are increasingly essential to the vitality of our nation as a whole.

The efforts of small rural providers also have had a positive spillover impact on the national economy. In 2009, rural communications providers contributed $14.5 billion to the economies of the states in which they operated. Amazingly, 66% of this economic output – $9.57 billion – benefitted urban areas, demonstrating the economic payback to the nation as a whole from USF and the operations of small rural providers.

Unfortunately, the promise of universal service is now in jeopardy. Because of cuts to USF support and related cost recovery mechanisms for small, community-based telecommunications firms, thousands of rural consumers could begin seeing their phone and Internet rates increase significantly in the next several months. In coming years, some rural consumers and businesses could see their service degrade significantly or disappear entirely because it’s no longer affordable or their carrier is no longer in business. Other changes, including new caps that shift every year in unpredictable ways, are causing many small providers to postpone investments and network upgrades for fear the cost of improvements will become unrecoverable.

These changes pose great risk for countless rural communities, whose residents and businesses rely on broadband and other communications services for their livelihoods. Over 4.5 million U.S. consumers receive communications services from small, independent telephone companies and cooperatives.

broadband in Kensal ND Paul Berg/Dakota Central Telecommunications Independent contractors spliced fiber for Dakota Central Telecommunications residents at a node site in Wimbledon, N.D. (pop. 216).

It’s commendable that the Federal Communications Commission (FCC) wants to direct more federal USF funding to the several million Americans who currently do not have access to high-speed broadband. But that goal should not be achieved in a manner that leaves millions more “locked in time” with respect to any broadband they receive and threatens to create a “rural/rural” divide, as communications technology in areas served by smaller providers degrade, becomes unaffordable, or disappears altogether.

In setting policies for USF and other broadband investment, it is crucial that we not limit the goal to getting broadband to rural America. Instead, we must focus on what it takes to keep broadband in rural America, and what it takes to make sure that broadband for rural consumers stays comparable in price and quality to those services available elsewhere in America — which by the way happens to be a statutory mandate.

Rural carriers have made great progress in delivering the promise of universal service. They have made great strides in delivering at least basic levels of broadband to their customers.  But their job is not done, and they need to invest in and upgrade their networks to keep up with what the FCC projects will be an increase in broadband speeds over time. If cuts to rural communications technology and other changes continue in their current form, rural communities and the nation as a whole will suffer the economic and connectivity consequences. At this critical juncture in our nation’s road to recovery, changes that cause rural carriers to eliminate jobs and stop investing in networks are not what we need.

Shirley Bloomfield is chief executive officer of the National Telecommunications Cooperative Association in Arlington, Va.