CEO, FCC Chair, visit rural Internet projects
August 2, 2012
The outlying frontiers of Douglas County and Eastern California are being connected to the modern world through a $1.3 million partnership between a large telecom corporation and the federal government.
On Monday, Frontier Communications CEO Maggie Wilderotter and Federal Communications Commission Chairman Julius Genachowski toured the Eastern Sierra to highlight broadband expansion projects in Yerington, Coleville, Topaz Lake, and portions of Alpine County.
“The more communities that have broadband, the stronger our country will be,” Wilderotter said.
Underlying the partnership is a premise that has existed since the Communication Act of 1934 – universal service in telephone and radio. But it wasn’t until the Telecommunications Act of 1996 that the FCC actually formalized the Universal Service Fund to subsidize underserved areas. All interstate telecom companies must contribute to the fund, often through consumer surcharges.
An explosion of high-speed Internet in the last decade, however, profoundly changed the nature of telecommunications. Last fall, recognizing the importance of broadband technology, the FCC established the $4.5 billion-a-year Connect America Fund, which gradually will divert money out of the USF to subsidize broadband projects in underserved areas.
In the 20th Century, Genachowski told a crowd at Carson Valley Inn, the platform for exchange of information was the telephone.
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“There is no question that broadband is today’s equivalent,” he said. “There’s common recognition that the country benefits when we connect rural America.”
Enter Frontier Communications, which acquired Verizon’s landline assets in Carson Valley and surrounding areas in 2010. Last month, the company announced that it had received roughly $72 million from the Connect America Fund for nationwide projects.
Frontier District Manager Kevin Ancell said $1.16 million of that will be used to extend service to 2,938 homes in Yerington and 424 homes in Topaz Ranch Estates, Holbrook Highlands and Topaz Lake. An additional $187,710 will be used for expansions in Coleville, Walker, and the Sorensen’s Resort area.
As part of their capital improvement plan, without subsidies, Frontier Communications has already been ramping up broadband to more than 5,700 households in Carson Valley, as well as in Woodfords and Markleeville.
Much of the new infrastructure consists of laying fiber-optic cable to distributional nodes, where signals then run over existing copper lines into homes.
“The world becomes their oyster,” Wilderotter said, stressing the quality of life in rural locations. “They have the freedom and flexibility to call life their own and not give that up.”
Wilderotter said 80-95 percent of Frontier’s service portfolio sees a decent return on investment. The remaining areas, on the very fringes of society, would not be profitable without subsidies.
“With the help of the Connect American Fund, we can expand into households that otherwise wouldn’t be economical,” she said.
For anyone doubting the value of broadband in rural America, Genachowski pointed out that 80 percent of Fortune 500 companies now post job positions online.
In other words, those without access to high-speed Internet, including small businesses, may be at a serious disadvantage in the marketplace.
“You can’t succeed in the modern economy without it,” he said.