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North Carolina Coop Fibers Up Rural Counties and More - Community Broadband Bits Podcast 188

North Carolina is increasingly split between those in urban areas, where some private sector providers are investing in next-generation gigabit networks, and rural areas where the big providers have no plans to invest in modern networks. But coming out of Wilkes County, a cooperative ISP called Wilkes Communications and River Street Networks is taking fiber where the big companies won't. 

This week, Wilkes Communications and River Street Networks President & CEO Eric Cramer joins us for Community Broadband Bits episode 188 to discuss their approach, history, and plans for keeping rural communities well connected. They offer gigabit fiber, telephone, and cable television services. Wilkes has already upgraded all of its original 8800 member-owners from copper to fiber, with some help from the broadband stimulus programs to reach the costliest areas. It is now expanding to nearby areas and has overbuilt the population center of the county after CenturyLink continued plugging away with last century solutions. 

Coops like Wilkes are especially important as North Carolina's Legislature has created barriers to prevent municipal networks like Wilson (coverage here) from serving their rural neighbors. 

This show is 25 minutes long and can be played on this page or via Apple Podcasts or the tool of your choice using this feed.

Transcript below.

We want your feedback and suggestions for the show-please e-mail us or leave a comment below.

Listen to other episodes here or view all episodes in our index. See other podcasts from the Institute for Local Self-Reliance here.

Thanks to Kathleen Martin for the music, licensed using Creative Commons. The song is "Player vs. Player."

Chanute and Chattanooga Added to List of Rural Broadband Experiment Funds

A year ago, the FCC accepted applications from entities seeking Connect America funds for rural broadband experiments. After provisional awards and some eliminations, Chanute's FTTH project, Chattanooga's EPB, and a number of additional cooperatives are now on the list of provisional winners reports Telecompetitor.

According to the article, $27 million became available when 16 entities were eliminated for various reasons.

A recent Chanute Tribune article reports that the city's expected award will be approximately $508,000 if it passes the FCC's post-selection process. Mikel Kline, a consultant working closely with the city on its FTTH project told the Tribune:

It is Kline’s understanding that this $508,467 would be cost support for the city’s Fiber to the Home network over the next six years. It requires the city to become an eligible telecommunications carrier, and to finance and construct the fiber network.

This money can be used to pay operational costs or offset a portion of the debt on the city’s investment in the local infrastructure over the next six years.

Remember that Chanute has developed its fiber infrastructure incrementally over more than two decades. The community is moving ahead with its FTTH project to share the benefits of fiber with residents and more businesses after bringing better connectivity to schools, municipal facilities, and a growing number of businesses. 

Recently, the city applied for and received state approval to bond for deployment costs. A 1947 state law required the application be filed with the Kansas Corporation Commission, the state entity concerned with utility regulations. According to Kline, the city has also applied for eligible telecommunications carrier (ETC) status. This designation will allow the city, as a common telecommunications carrier, to obtain Kansas Universal Services Funds.

National Rural Assembly Webinar: Expressions of Interest for Connect America Funds

On January 30, the FCC announced it will begin a process that makes Connect America funds available for pilot projects aimed at expanding broadband in rural areas. Details about the process are still forthcoming, but the FCC asks interested parties to submit "expressions of interest" by March 7th. In order to assist possible applicants, the National Rural Assembly's Broadband Working Group will hold a webinar today, February 13th, at 1:30 EST.

From the webinar announcement:

The National Rural Assembly's Rural Broadband and Policy Group invites all rural stakeholders, to participate in a national webinar in cooperation with the Federal Communications Commission that will explain how to participate in the FCC's new experiment, the Rural Broadband Trials - a program that will fund projects to bring broadband to rural areas.

Participation in this first phase is not mandatory but encouraged. The results from the expressions of interest process will help the FCC determine how much funding will be needed.

You can register online for the free webinar.

March 7th Deadline for Connect America Fund Expressions of Interest

We reported last month on a decision from the FCC to make Connect America funds available to expand broadband. At the time we did not have much detail on the measure, but on January 30th, the FCC released its official statement. The agency reached a unanimous decision to open up Connect America Fund dollars for experimental projects.

The FCC restructured the Universal Services Fund (USF) in 2010 to create the Connect America Fund. Until now, those funds were only available to large incumbents. Because some incumbents did not want to be bound terms associated with the funds, they did not take the money and so a portion of it has not been distributed.

In the January 30th announcement, the FCC stated that it will open up funding to entities other than large incumbents in experimental processes, including nonprofits, cooperatives, municipal and tribal governments, and private businesses. The FTTH Council reported:

Specifically, the Commission’s order outlines a call for multiple pilot projects to examine how best to make the technology transition while preserving consumer welfare and promoting the widespread deployment and use of broadband networks. As part of those projects, the Commission, informed by recommendations of the FTTH Council, will be using “test beds” to experiment with different models of bringing next-generation high-speed broadband to rural areas. 

Interested parties must first file an expression of interest, describing how they would invest the funds. In keeping with the original goal of the Connect America fund, the FCC hopes to hear from organizations with rural broadband project plans. According to a Daily Yonder article on the process:

[Jonathan Chambers, the chief of the FCC’s Office of Strategic Planning and Policy Analysis] said the initial “expression of interest” isn’t a complex document. The FCC wants to hear who is interested in applying for support, what homes or institutions they want to serve and an estimate of the cost to get the job done.

Potential Funding Availability via Race to the Top

Let me start by saying that I don't yet know anything in addition to what I write below. We are all waiting for more details. On January 30, the FCC will take action on the FTTH Council's Gigabit Race to the Top progam. We previously took a brief look at the idea, while focusing on big cable and telephone companies' responses. FTTH Council expects the FCC to adopt a test program that will start with a call for those interested to submit "expressions of interest." The reason we are noting this now, when we know so little about the program is that they believe the program will move quickly once it is announced, so those who may be interested should start planning for it. From what we know, this program will be open to community owned networks and will be largely focuses on smaller markets with preference for networks that will be improving connections to anchor institutions in particular. Below, I have embedded a discussion between Craig Settles and Alyssa Clemsen-Roberts, the Industry Affairs Manager at the Utilities Telecom Council.
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Orangeburg County, South Carolina, Moves Ahead With Stimulus-Funded Broadband

Orangeburg County, South Carolina, received $18.65 million in broadband stimulus funds for high-speed broadband (which we previously noted). Unfortunately, AT&T and its friends at ALEC have since pushed through a state law to limit local authority in building networks.

According to the Broadband Adoption Map from the Investigative Reporting Workshop of the American University School of Communication, Orangeburg County has a broadband adoption rate of 20-40% as compared to the national rate of 60%.

Not only has AT&T refused to invest in modern networks in much of South Carolina, it is not even bothering to accept a federal subsidy that would underwrite some of that cost. Which is actually good for the rest of us, because subsidizing any AT&T activities is a very poor use of taxpayer dollars.

But Orangeburg is moving forward on its own. The Orangeburg County Council approved a $2.4 million contract with Edwards Telecommunications to complete the third phase of their project. This phase alone will use 171 miles of fiber and add 902 households to the network. Two more phases are scheduled before the entire project is complete.

According to a Gene Zaleski Times and Democrat article:

Seventy-five percent of the project will be paid for with a U.S. Department of Agriculture Rural Utilities Service grant and the remaining 25 percent will be paid for with proceeds from the Orangeburg County capital project sales tax.

In 2010, after receiving the award, the County expressed their optimism in a Phil Sarta article in the Times Democrat:

Nonprofit Approaches Solve The Rural Broadband Problem

Wally Bowen has again penned an op-ed that we gained permission to reprint. The original ran in North Carolina's Durham News Observer. President Barack Obama said in his State of the Union address that he wants to upgrade the nation's "critical infrastructure," including our "incomplete high-speed broadband network that prevents a small business owner in rural America from selling her products all over the world." The Green Bay Packers know how to tackle this problem. Green Bay, Wis., population 104,000, and its National Football League franchise have much in common with communities left behind in today's broadband world. In 1923, the Packers faced a similar crisis. How to keep the team in Green Bay despite being in an "uncompetitive" market. Green Bay took a page out of the playbook of rural electrification. It converted the franchise into a community-owned nonprofit. The move permanently tied the Packers to Green Bay and lifted the burden of generating profits for outside investors. In short, Green Bay found a business model in scale with its market. Rural electrification via a community-ownership business model began more than 100 years ago when for-profit utilities bypassed rural areas. This self-help solution has deep roots in rural America, where nonprofit cooperatives have long provided essential services for local economies. Yet the congressionally mandated National Broadband Plan omits nonprofit networks as part of a universal broadband strategy. Blair Levin, a former FCC official and Raleigh attorney, is the Plan's lead author. According to Thomas Friedman in a Jan. 3 column in The New York Times, Levin now believes that "America is focused too much on getting 'average' bandwidth to the last 5 percent of the country in rural areas, rather than getting 'ultra-high-speed' bandwidth to the top 5 percent in university towns, who will invent the future." Levin leads Gig.U, a consortium of major research universities - including UNC-Chapel Hill, Duke and N.C. State - promoting "ultra-high-speed" Internet access. He has every right to advocate for Gig.U, but doing so at the expense of under-served rural communities raises concerns about his work with the National Broadband Plan. Universal access to electricity was made possible by the 1936 Rural Electrification Act, later amended to help launch rural telephone cooperatives.