Rural vs. Metro Broadband - Who Will Become the "Under Served"?

Bookmark and Share
Rural Telecommunication/Energy Cooperative Broadband vs. Urban and Suburban (Metro) Broadband

Brief History

The National Rural Electric Cooperative Association (NRECA)

Electric cooperatives are private, independent electric utilities, owned by the members they serve. Democratically governed businesses, electric cooperatives are organized under the Cooperative or Rochdale Principles, anchoring them firmly in the communities they serve and ensuring that they are closely regulated by their consumers.

The National Rural Telecommunications Cooperative (NRTC)
NRTC was founded in 1986 by the National Rural Electric Cooperative Association (NRECA) and the National Rural Utilities Cooperative Finance Corporation (CFC). NRTC provides products and services developed specifically to meet the needs of rural utilities and their customers, such as high-speed Internet access via satellite, full service Internet access and support, automated meter reading, SmartSCADA, wireless technologies, power quality products, long distance programs, mobile phone service, IP backbone services, direct broadcast satellite service (DBS) with DIRECTV and Internet protocol television (IPTV).

By the numbers:

  • 40 million people in 47 states.
  • 17.5 million businesses, homes, schools, churches, farms, irrigation systems, and other establishments in 2,500 of 3,141 counties in the U.S (80 percent of the nation's counties).
  • 12 percent of the nation's population.

2.5GHz EBS/3.65GHz Broadband Wireless and Telecommunication/Energy Cooperatives Provide Distinct Advantage - Perfect Model for NTIA BTOP and RUS

During their haste to secure long term leases from non-profit EBS License holders in major metropolitan service areas (MSAs, Metro, Urban and Suburban markets) Sprint and Clearwire passed over many rural markets simply because they determined that the revenue was not there and did not suit their ROI models.

Enter the NTIA BTOP and RUS broadband stimulus programs. As beneficiaries of first tranche funding from the Department of Agriculture Rural Utilities Service (RUS, $2.5 billion) rural markets in the United States are now poised to set the standard not only for enhanced fixed, nomadic and mobile broadband wireless infrastructures, services and applications but to bolster consumer awareness, adoption and advocacy of their existing Telecommunications and Energy Cooperatives that now exist.

The NRECA and the NRTC should begin immediately to determine who is in control of the 2.5GHz EBS band in their respective markets . The advantages of being able to use thisbroadband-180.gif spectrum in conjunction with 3.65, 5.n, 4.9 and 2.4GHz spectrum are tremendous for their existing consumer base. And by offering new state-of-the-art broadband wireless facilities to their markets they will inevitably attract new customers to their cooperatives.

The broadband service applications surrounding these cooperatives are also very conducive to sustainable NTIA BTOP and RUS programs. This includes ubiquitous high speed wireless network access from anywhere within the coverage area, much improved IP based communications (VoIP) and facilitating much needed two-way residential and commercial energy control and conservation programs leading to smart grids and local energy storage at the home.  

There are far too many broadband service applications to mention but all one has to realize is that by encompassing energy control and conservation, telecommunications and enhanced broadband infrastructures and applications, all of which all are managed, operated and overseen by the consumers they serve represents a pivotal fundamental improvement to traditional business models offered by large broadband service providers in medium and large sized metropolitan, urban and suburban markets.

Urban and Suburban markets are not so lucky. Most consumers in these markets are beholding to behemoth service providers for their broadband and energy needs and these consumers are offered no participation or public input regarding development, deployment or functionality of the networks. Costs remain high while technological advances remain dormant.
 
As newer state-of-the-art wireless facilities are introduced in rural markets it is the urban and suburban markets that will become "under served" thanks to the blatant support of large incumbent service providers by the FCC and their policy/rule changes in both the 2.5GHz and 700 MHz spectrum.

Maybe large incumbents will be able to match rural speeds and QOS in urban and suburban markets but they will not be able to match the low costs and overall community benefits derived from operating under cooperative business models as in rural markets.

Digital Bridge Communications Corp. (DBC) has seen the light. They recently inked a deal with the NRTC. By combining capabilities, NRTC members and DigitalBridge will be able to rapidly deploy affordable, next-generation WiMAX services to large parts of rural America. DBC's deployment capabilities, state-of-the-art Network Operations Center, scalable billing and customer care systems, and solid operating record will be further leveraged and enhanced by NRTC members' track record of rolling out new technologies in their rural communities.

060809_WiMax[2].gif

DBC will be taking full advantage of the available spectrum in rural markets, namely the 2.5GHz Educational Broadband Service (EBS) band in combination with the 3.65GHz band and other synergistic spectrum.

Urban and suburban broadband markets, mostly controlled by large incumbent operators and service providers are now going to become the "under served" while consumers in those markets will be paying top dollar for antiquated broadband services.




1 Comments

Excellent analysis. It is indeed predictable that rapid deployment of mobile broadband in rural, and hitherto underserved and unserved areas, will result in those areas leapfrogging urban areas in their faster, and more affordable and readily available connectivity to high-speed Internet. In fact, RuMBA has been saying that from the very beginning. The stimulus package can not only help to spread the reach of broadband to all corners of America, but also to put the players or providers of broadband large and small, in a level-playing field. All the while, this new scenario also begins to draw the new American capitalistic model, more reliant on social entrepreneurship, where municipalities, cities, small businesses, community entities and non-profits begin to complement the new Internet Superhighway. The large players, of course, will continue their trajectory towards reinforcing existing networks and should quickly adapt to the new model, and even supplement and help to train the smaller players in carefully drawn private/public partnerships.

Luisa Handem
Managing Director
RuMBA USA

Leave a comment