All Communities Need Broadband to Survive Economically, Agencies Told

“I'm going to speak from living in a small town of 6,000 people in rural southwestern Kansas,” said Catherine Moyer of Pioneer Communications in Ulysses. “Broadband is one of the best economic tools that we have. In order to convince businesses to locate in rural America or to allow current businesses to remain there, broadband is necessary.” Broadband is also pivotal to getting skilled employees to move to an area, she said. “The Facebook generation will not take a job and move to an area in which broadband is not readily available.”

The programs’ definition of broadband will have a “ripple effect on both the type and scope of development” that will result, said Geoffrey Blackwell, chairman of the National Congress of American Indians’ telecommunications subcommittee. “In Indian Country, we have an anecdotal 5 to 8 percent broadband penetration rate … I'm very skeptical of the higher end. What I am confident about is that our statistics for communications deployment in Indian country are deplorable.” Blackwell said phone penetration there is 68 percent at most, compared with almost 97 percent for the U.S. All tribal lands should be considered unserved, he said.

Emy Tseng, director of San Francisco’s Digital Inclusion Programs, said urban areas shouldn’t be left out. The NTIA and the RUS need to develop definitions for unserved and underserved taking into account that many groups within a city have very low Internet adoption rates.

“There is a real need to define underserved in this relative fashion, because many major metropolitan areas, such as San Francisco, New York, Minneapolis … have high broadband adoption rates compared to the national data but have also large underserved and low-income populations,” Tseng said. “I would argue that the lack of access in an area of high adoption can put these communities at an even greater disadvantage.” For example, she said, whites are four times as likely as Latinos to have Internet access at home.

Rural communities aren’t the only underserved areas, said William Sagel, the Las Vegas Police Department’s IT director. “There are many places in the country today, even places like Las Vegas, where services aren’t adequate,” he said. “You can experience this today with your ability, or inability as it were, to make a digital cell phone call reliably.”

The agencies also sought comment on the tests they should use to decide who gets grants. Don Jackson, with Tri-County Telephone in Basin, Wyo., said proposed projects should be evaluated based on how many people will be affected, the cost per subscriber and “bang for the buck.” That’s the bandwidth speeds provided and the public good that will be served as defined by the benefit to hospitals, public safety and those with low income. Those awarding grants should also look at whether the project will help a community’s economy. “That’s a very meaningful things in rural communities,” Jackson said. “It’s a lifeline. I suppose we could weave into that the number of jobs that could be created.” He said, “There are two things that dictate economic success and, correspondingly, the economic well-being of citizens. One is transportation and the other is communications.”

The NTIA and the RUS can’t ignore applicants’ track records, Jackson said. “What experience do they have?” he said. “Do they have qualified personnel? What is their track record? What resources do they have to operate and maintain and operate this network after the grant has been provided and fulfilled. It doesn’t stop there.” The agencies should be on guard, Jackson said. “There’s something about the smell of money that seems to bring out a certain group of individuals,” he said. “We need to make very sure that those who are recipients are those who can and will deliver.”

Projects should be graded “within the proper context and not in a vacuum,” said Jason Lazar, general counsel of KeyOn Communications. Those who award grants must look closely at each applicant, asking, “Is this applicant credible? Can it do what it says?” Projects that can be completed quickly should get priority, Lazar said. “Keep your eye on the ball with respect to the goals,” he said. “This is about broadband deployment, broadband penetration and job creation. Make sure this is where the funds are going.”

“The most important” test is an applicant’s “financial stability and outlook,” Moyer said. “Funding established companies that are stable will lead to prudent investment of the stimulus dollars. Additionally, those established companies will be less likely to fold their businesses once the stimulus dollars are spent.” The agencies should keep in mind that it’s cheaper to upgrade facilities than to build a new network. “NTIA and RUS should also contemplate the middle mile, an issue many of today’s broadband providers face,” Moyer said. “While the broadband network is being extended further into areas where there’s no service, many companies cannot afford the large middle-mile facilities to connect these customers to the Internet backbone.”

With the gaming and service industry in decline, Nevada is shifting its focus to renewable energy and other industries, said Jerry Sandstrom, a deputy director of the Nevada Commission on Economic Development. As a result, broadband is more important to communities than ever. “We've got to believe that in all of this broadband access is going to be an important part in terms of the evolution of Nevada’s economy from what has traditionally been a service economy to hopefully a technology-based economy,” Sandstrom said.

Small communities find that they can’t compete without broadband, said Gary Longacre with the Nevada Rural Housing Authority. He pointed to a small community in the state that was considered as a location for a small, medical insurance back-office company. “It would have been 35 jobs, and 35 jobs in the rural part of our state is a lot of jobs,” he said. “In the competition they lost out because of their lack of Internet capacity.” Another company in rural Nevada exports pet food, he said. “To track their shipments, they have to get on the telephone Internet service. Wouldn’t it be great if they could track their shipments over the broadband? Wouldn’t it be great if they could receive payments for their shipments through the Internet?”

The agencies were to hold a public meeting Wednesday night with the FCC in Flagstaff, Ariz. That was the end of a two-night road show. There’s a session Thursday in Washington.