Tag: "subsidies"

Posted January 14, 2020 by Katie Kienbaum

The federal government is about to spend more than $120 million on subsidies that, rather than improving rural connectivity, will make tens of thousands of families worse off.

These funds are part of a 2018 federal program intended to expand rural broadband access called the Connect America Fund phase II (CAF II) reverse auction. The program, in which Internet access providers competed for subsidies, will distribute nearly $1.5 billion over the next 10 years to connect unserved rural residents. But in some communities, the auction may do more to widen the digital divide than diminish it.

While some winning bidders committed to building out high-speed fiber optic networks, satellite company Viasat will rake in more than $120 million in subsidies to continue providing inadequate geostationary satellite connectivity to rural households that are clamoring for something better. Not only does satellite Internet access offer slower speeds, greater latency, and less reliability for a higher cost compared to other technologies, but Viasat’s subsidies are making those areas ineligible for future broadband funds, deterring other providers from building truly high-quality networks. Instead of bridging the digital divide, the process will relegate certain communities to satellite Internet access while others receive ultra-fast fiber and do nothing more than deepen the fissure.

Mo’ Money . . .

The Connect America Fund (CAF) is a multi-phase subsidy program that supports improved connectivity in rural, high-cost areas as part of the Federal Communications Commission's (FCC’s) Universal Service Fund. The most recent phase of the program, the CAF phase II reverse auction, auctioned off regions to providers using a complicated formula that prioritized bids for low subsidy amounts and high-quality service.

Previous rounds of CAF mainly subsidized the large incumbents, such as AT&T and CenturyLink, but for the reverse auction, the FCC opened participation to other entities, including non-traditional providers like electric cooperatives. Eligible areas included rural locations where the incumbents had previously refused subsidies (and the accompanying commitment to expand Internet access).

Viasat was one of the largest winners in the CAF II reverse auction...

Read more
Posted November 13, 2019 by Katie Kienbaum

Despite raking in hundreds of millions in government broadband subsidies, Frontier Communications has failed time and time again to bring reliable, high-speed connectivity to the rural communities it serves. Instead of investing in network upgrades, Frontier has neglected its rural infrastructure to the detriment of its subscribers and the company’s own financials, with its worsening service quality paralleling its plummeting stock value.

Our new fact sheet, Frontier Has Failed Rural America, presents evidence of Frontier’s negligence and suggests that rather than continuing to trust Frontier, government officials should look to publicly owned and community-minded providers to connect rural residents, businesses, and institutions.

Download the Frontier Has Failed Rural America fact sheet [pdf].

Subsidies Can’t Fix Frontier

Federal and state government agencies have given Frontier nearly $2 billion to expand and upgrade its rural broadband networks. The company has received approximately $1.7 billion from the Connect America Fund Phase II federal subsidy program and millions more in grants from states like Minnesota and New York.

Even with the subsidies, Frontier ultimately failed to connect rural communities with high-quality broadband. The company has repeatedly chosen not to upgrade rural networks, leaving subscribers with poor, unreliable service that doesn’t fulfill their basic communications needs.

Frontier’s “Systemic Problems”

Our fact sheet, Frontier Has Failed Rural America, features events from the past five years that demonstrate Frontier’s inability to solve the rural broadband problem, including:

  • Numerous state investigations into Frontier’s poor service quality
  • Settlements with state agencies for overstating speeds
  • The company’s plummeting stock price and impending bankruptcy
  • Repeated indications that Frontier...
Read more
Posted September 25, 2017 by htrostle

Another addition to our Community Networks Initiative resources! This fact sheet details the most important aspects of the Connect America Fund (CAF) Auction. What is it? What should it do? Who does it affect? And how can you make a difference?

The Federal Communications Commission (FCC) manages the CAF program, which provides billions of dollars in subsidies to Internet service providers for areas where the cost of building networks is prohibitive. Some large providers decided not to accept some of the subsidies during Phase I - about $198 million annually for 10 years. Now, the FCC plans to host an auction so that providers can submit competing proposals on how best to serve these often rural, high-cost areas. (Check out the map of preliminary areas on the FCC website.)

Before the FCC can hold an auction though, the commission needs advice on how best to conduct it and what criteria they should consider. Jon Chambers, former head of the FCC's Office of Strategic Planning and Policy Analysis, outlined his concerns about the current proposed rules in his article, The Risk of Fraudulent Bidding in the FCC Connect America Fund Auction. Listen to his analysis on Episode 268 of the Community Broadband Bits Podcast.

The first round of public comments has passed, but reply comments are due October 18th, 2017. Read the fact sheet and then submit your own comments at FCC.Gov/ecfs/filings for "Proceedings" Docket 17-182 and Docket 10-90.

Posted September 7, 2017 by Staff

This is the transcript for episode 268 of the Community Broadband Bits Podcast. Jon Chambers of Conexon once again joins the show. This time Jon dives into the details of the Connect America Fund program and discusses the upcoming Connect America Fund auction. Listen to this episode here.

Jon Chambers: Rural Americans, have the same aspirations, the same needs, the same uses of the Internet as everyone else. It shouldn't surprise anyone when I say, rural Arkansans, rural Missourians subscribe to gigabit services too. It does surprise people. It surprises people at the FCC, it surprises policy makers. Doesn't surprise people who live and work and spend their lives in rural America.

Lisa Gonzalez: This is episode 268 of The Community Broadband Bits Podcast from The Institute For Local Self-Reliance, I'm Lisa Gonzalez. As the question of how best to bring high quality Internet access to rural America becomes more pressing, rural cooperatives are rapidly taking a leading role. This week's guest, Jon Chambers, works with electric cooperatives that decide they want to offer high speed connectivity. Jon spent time working for the FCC and has a special understanding of how the agency approaches review and funding for telecommunications. In this conversation, he and Christopher talk about the Connect America Fund. Learn more about Jon's firm, visit their website at conexon.us. Now, here's Christopher and Jon Chambers from Conexon.

Christopher Mitchell: Welcome to another edition of The Community Broadband Bits Podcast. I'm Chris Mitchell at The Institute For Local Self-Reliance. Today, I'm once again with Jon Chambers, a partner at Conexon. Welcome back to the show Jon.

Jon Chambers: Thank you Chris. Thanks for inviting me.

Christopher Mitchell: You've been on the show multiple times recently, talking about how rural electric cooperatives can basically solve this problem for all of rural America. Do you want to briefly remind us what Conexon is?

Jon Chambers: Conexon is a consulting firm that was started by my partner, Randy Klindt, who conceived of, designed and oversaw the construction of the very first fiber-to-the-home network built on an electric...

Read more
Posted August 29, 2017 by lgonzalez

Jon Chambers, a partner at Conexon, returns to visit us this week to talk about rural connectivity and the approaching Connect America Fund (CAF) auction. Conexon works with electric cooperatives to establish high-quality Internet networks for members, typically in rural areas where national providers don’t offer the kinds of services communities need.

Having spent time at the FCC to examine several of their spending programs, Jon Chambers is our go-to guest to discuss next year’s Connect America Fund auction. In this interview, Jon and Chris talk about some of the problems that plague the program and how potential new bidding and award rules will set future deployment standards. Jon gets into where the rules fall short on expanding rural connectivity and offers suggestions for a more consumer driven approach.

For more details on Jon’s thoughts about how to improve the bidding process for the Connect America Fund, check out his article, The Risk of Fraudulent Bidding in the FCC Connect America Fund Auction, on the Conexon blog.

To comment on the FCC proceedings on Competitive Bidding Procedures and Certain Program Requirements for the Connect America Fund Phase II Auction, submit your thoughts at the FCC website under proceeding Docket 17-182 and Docket 10-90.  

For more information on rural electric cooperatives and their efforts to bring high-quality connectivity to their members, listen to Jon talk with Christopher for episode 229 of the Community Broadband Bits podcast.

Read the transcript of this show here.

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

This show is 30 minutes...

Read more
Posted August 28, 2017 by Staff

This is the transcript for episode 267 of the Community Broadband Bits podcast. Michael Anderson from Spiral Internet joins the show to explain how this small ISP is building next-generation networks in rural California. Listen to this episode here.

Michael Anderson: If there's an existing incumbent nearby, and they claim that area, then they can say, "No, you can't fund that, we'll challenge it," and then they don't really have to give you a timeframe as to when they are going to provide that service, so it is a real show stopper.

Lisa Gonzalez: This is episode 267 of the Community Broadband Bits podcast, from the Institute for Local Self-Reliance. I'm Lisa Gonzalez. This week, Michael Anderson from Spiral Internet, and Christopher, talk about the California company, their history, and their approach. They also discuss what it's like to work in an environment where national providers do all they can to pretend competition from ISPs like Spiral. Some of those efforts are playing out right now, as the state legislature reviews funding that has traditionally been used to expand Internet access in rural areas. Before we start the interview, we want to remind you that this commercial-free conversation is not free to produce. Please take a moment to contribute at ILSR.org. If you've already contributed, thanks. Now here's Christopher and Michael Anderson from Spiral Internet.

Christopher Mitchell: Welcome to another edition of the Community Broadband Bits podcast. I'm Chris Mitchell with the Institute for Local Self-Reliance up here in Minneapolis. Today I'm talking with Michael Anderson, the Chief Information Officer for Spiral Internet, all the way out there in California. Welcome to the show.

Michael Anderson: Thank you, Chris.

Christopher Mitchell: So, you are in California, but in a place called Nevada City, I believe, which confuses me every single time I talk to you or one of your folks from Spiral Internet. Can you tell us a little more about your company?

Michael Anderson: Whenever you hear Nevada City, California, people still think that we are in the state of Nevada, which is not the case. Actually, Nevada City had the name "...

Read more
Posted August 23, 2017 by christopher

With the right policies and local investment, Spiral Internet could bring high quality Internet access to much of northern California. Spiral is a small private company and its CIO, Michael Anderson, talks with us today for episode 267 of the Community Broadband Bits podcast. 

We discuss Spiral's enthusiasm for open access fiber networks and how the California Public Utilities Commission (CPUC) is funding some rural Internet investment. In particular, we get a sense of how Spiral is making the transition from reselling DSL to fighting for open fiber networks in rural California. 

One of the larger challenges today is an effort in the California Legislature to modify the rural broadband subsidy program to essentially give AT&T veto power over the CPUC grants. As we have discussed many times before, AT&T and some of the cable companies want a right of first refusal to grants, a policy that would dramatically disrupt the process for the smaller companies that are actually investing in high quality connectivity in areas poorly served by the incumbents. 

Read the transcript of this show here.

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

This show is 28 minutes long and can be played on this page or via iTunes or the tool of your choice using this feed.

You can download this mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license.

Posted July 6, 2017 by lgonzalez

If you live in rural America, chances are you know what it’s like to have inadequate Internet access. If you've heard about the Connect America Fund, however, you probably think help is on the way and your problems will soon be over; you'll get the kind of speeds available in large cities, right? Wrong.

Our short video on rural connectivity and CAF explains how big companies are taking federal subsidies to build networks that provide the same old slow DSL service to rural areas. So, what can people in rural communities do? The video describes how local communities are becoming more self-reliant through publicly owned infrastructure and offers some starting points if you're interested in learning more.

More Of The Same? No Way!

The Connect America Fund (CAF) is offering billions of dollars to build out networks in rural areas, but the companies receiving the subsidies are the same ones that already offer terrible connectivity in most rural communities. Are they using those subsidies to invest in high-speed connectivity for rural areas? No. The DSL connections that those companies are deploying for your home or business with CAF funding is already considered obsolete.

Rather than accepting these substandard solutions, an increasing number of communities have decided to act so they can have the same or better quality of connectivity as urban areas. Rural cooperatives and municipal networks are taking charge of their own telecommunications infrastructure needs. Unless you live in one of these communities, you may have never heard about the fast, affordable, reliable connectivity available from a community network or a cooperative. They’re just doing it and not bragging about it.

YOU Make It Happen

How does a community or a cooperative start offering better connectivity? We’ve created this short video that explains the basics and we invite you to share it with others. It all starts with YOU.

Be sure to check out our other videos, too!

Posted May 3, 2017 by lgonzalez

We’ve been covering the East-Central Vermont Community Fiber-Optic Network (ECFiber) since 2009; it has come a long way from inception. ECFiber is a group of rural Vermont towns that are working together to deploy a regional network to offer high-quality Internet access to communities typically stuck with slow, unreliable connections such as DSL and dial-up. In this episode, Christopher talks with Carole Monroe, CEO of ValleyNet, and Irv Thomae, District Chairmen of ECFiber’s Governing Board. The not-for-profit ValleyNet operates the ECFiber network.

The organization has faced ups and downs and always seemed to overcome challenges. It began with funding from individual local investors who recognized the need to bring Fiber-to-the-Home (FTTH) to the region. Now, the organization is characterized as a “communications union district,” which creates greater funding flexibility and stability.

In this interview, Carole and Irv talk about the new designation and the plans for bringing the network to the communities that are clamoring for better Internet access. They also get into recent developments surrounding overbuilding by DSL provider FairPoint, a project funded by CAF II subsidies. We hear how ECFiber is bringing better connectivity to local schools and helping save public dollars at the same time and we find out more about the ways Vermonters in the eastern rural communities are using their publicly owned network.

Read the transcript of the show here.

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

This show is 29 minutes long and can be played on this page or via iTunes or the tool of your choice using this feed.

You can download this mp3 file...

Read more
Posted April 19, 2017 by christopher

As we continue to cover the growing movement of rural electric cooperatives to bring high quality Internet networks to their members, we wanted to bring Alyssa Clemsen-Roberts back on the show. Alyssa was last on the show for episode 109 and has since moved from the Utilities Telecom Council to Pedernales Electric Co-op in Texas.

Though Pedernales is not considering a major broadband investment, Alyssa's insights from her years working with many electric utilities are valuable in understanding what electric co-ops have to consider before making a network investment. 

We start off by discussing the recent legislation in Tennessee that finally allows electric co-ops to offer Internet access before we move on to the real considerations a general manager has to examine before getting into telecom. We also talk quite a bit about the interplay between rural electric co-ops and telecommunications companies.

Read the transcript of the show.

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

This show is 32 minutes long and can be played on this page or via iTunes or the tool of your choice using this feed.

You can download this mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Break the Bans for the music. The song is Escape and is licensed under a Creative Commons Attribution (3.0) license.

Pages

Subscribe to subsidies