ASHEVILLE, N.C. – A group of rural broadband advocates is calling on the Federal Communications Commission (FCC) to reform its rural broadband policies by acknowledging that community-based broadband networks may serve some rural communities more effectively than non-local, for-profit carriers.
The request was made in a March 2 filing by the Asheville, N.C.-based Mountain Area Information Network (MAIN) in response to an FCC request for public comment to evaluate and update the 2009 “Report on a Rural Broadband Strategy.” The public-comment request included related FCC actions such as the National Broadband Plan released in March, 2010. Congress mandated the 2009 report in the 2008 Farm Bill.
MAIN’s filing cites a bias toward for-profit business models and incumbent carriers, at the expense of community-based networks, in both the 2009 Report and the National Broadband Plan. The filing was endorsed by two California-based community broadband networks, Access Humboldt and Tribal Digital Village, and the Minneapolis-based Institute for Local Self-Reliance, which promotes federal and state policies supporting community broadband networks.
“This bias is both striking and ironic given both documents’ celebration of the historic success of nonprofit networks in providing rural telephone and electric services over the last seven decades,” said MAIN executive director Wally Bowen.
“Our filing asks the FCC to recognize that nonprofit business models are still viable today and should play a key role in any federal broadband strategy,” Bowen said. He cited the mountain region of North Carolina for examples of successful nonprofit broadband networks, ranging from traditional rural electric and telephone cooperatives to more recent community-based operations. These networks include: French Broad EMC, ERC Broadband, PANGAEA, MAIN, Skyline Membership Corp., and Balsam West, a public-private partnership of the Eastern Band of the Cherokee and a Franklin, N.C.-based software firm.
“For more than 70 years, rural electric and telephone networks have demonstrated that local ownership creates local jobs, grassroots innovation, accountability, and most importantly, effective stewardship over time,” said Bowen, who founded MAIN in 1995 to provide Internet access with a local phone call in mountain counties where residents incurred long-distance tolls to reach the Internet. “That’s why it is so puzzling that these key FCC documents downplay the role of local ‘self-help’ initiatives in federal broadband strategy,” he said.
Based in Eureka, CA, the nonprofit Access Humboldt manages Humboldt County’s public access, education, and government TV channels while leading a regional effort called Digital Redwoods to build and operate a fiber-wireless community broadband network to serve this remote region 225 miles north of San Francisco.
“For generations, local self-help initiatives like Digital Redwoods have provided essential services in rural communities across America,” said Sean McLaughlin, executive director of Access Humboldt. “These rural networks don’t just provide essential services, they build community, social capital and provide local jobs. It would be irresponsible not to include rural networks in our federal broadband strategy,” he said.
Tribal Digital Village is a nonprofit broadband network serving tribal communities in San Diego County, CA. Its director, Matthew Rantanen, said that federal policy that assumes only for-profit carriers can meet rural broadband needs is “out of touch with progress many rural communities have already made, and ignores local assets and needs that vary from one rural community to the next.”
MAIN’s filing commends the FCC for adopting a “technology-neutral” approach in assessing rural broadband technologies and infrastructure solutions. The filing calls on the FCC to adopt a similar unbiased approach in assessing potential rural broadband business models.
Christopher Mitchell, broadband director for the Institute for Local Self-Reliance, said the FCC’s tilt toward for-profit carriers “is evident in language that could have been written by a telecom lobbyist in its disdain for municipally-owned broadband networks.” He cites a passage in the National Broadband Plan claiming that “municipally financed service may discourage investment by private companies.” But the opposite is true, said Mitchell. “Municipal networks create a competitive marketplace, giving private companies an incentive to invest.”
Mitchell points to Monticello, MN, population 10,414, about 38 miles west of Minneapolis. In 2007, Monticello voters approved a plan to build a city-owned broadband network. The incumbent provider, TDS, cried foul and sued, claiming unfair competition. While the suit made its way through the courts, the Chicago-based carrier rushed to build a fiber-to-the-home network in Monticello. The Minnesota Supreme Court eventually upheld the town’s right to build a competing broadband network. Today, the town’s residents can choose 25 Mbps service from TDS for $39.95 a month, or 20 Mbps from Monticello Fiber Net for $34.95 a month.
Similarly, Lafayette, LA, fended off lawsuits from both cable and telephone incumbents to build its fiber-to-the-home network, which launched in early 2009. With municipalities winning in state courts, cable and telecom companies have turned to state legislatures. At least 19 states have enacted laws limiting or prohibiting municipal broadband, while at least 35 states are considering bills, according to the FCC.
The filing also asks the FCC to include community broadband networks in its plan to shift Universal Service Fund subsidies to support broadband access in rural and other underserved areas. The fund generates more than $7 billion a year from telephone subscribers, who pay about $2 a month to ensure universal telephone access. Current USF reform proposals exclude community broadband networks.
Bowen noted that a rural broadband crisis exists because for-profit carriers are required by law to put the interests of investors and Wall Street ahead of the interests of rural residents and businesses. “Investing limited federal subsidies in business models ill-suited for rural communities is bad policy,” he said. “With our national focus on jobs, deficits and income disparities, it would be foolish and tragic to ignore the job-creation and long-term cost advantages of community broadband networks.”