Joan Engbretson

As federal and local government agencies award funding to cover some of the costs of deploying broadband to unserved and underserved rural areas, one company that has used that funding from a variety of sources to fuel its deployment efforts is Surf Internet. The company—which serves parts of Illinois, Indiana and Michigan—has been around since 2001 and initially focused on using fixed wireless broadband to serve rural areas.

Vermont has been funding a considerable portion of projects undertaken by communications union districts (CUDs) – local organizations representing at least two towns that will own the broadband infrastructure that they deploy. One of these CUDs is NEK (Northeast Kingdom) Broadband, which represents five counties. NEK Broadband expects to need between $165 million and $185 million to achieve the goal of ensuring high-speed broadband internet service is available to the most rural and underserved communities.

The Department of Agriculture awarded Tombigbee Communications a $2.98 million grant for a rural utility broadband deployment in Alabama. Steve Foshee — president and CEO of Tombigbee Communications and its parent company Tombigbee Electric Cooperative — explained that the funding is for one of the most remote parts of a broader area that the company has targeted for broadband deployment. Tombigbee, which offers broadband under the Freedom Fiber brand, aims to deploy broadband throughout 1,000 square miles of rural Alabama where many people do not have broadband available to them at the min

Post Road Foundation, an organization funded by The Rockefeller Foundation, will fund studies in five rural communities to explore the economics of the telecom utility partnership.

2016 was a big year for telecommunications mergers and acquisitions. Telecompetitor covered more than two dozen mergers and acquisitions in 2016 and they involved numerous facets of the industry. Here’s a summary of key trends and how they are reshaping the communications service provider playing field:

The biggest changes occurred in the cable industry, where the desire to obtain increased scale spurred a mega-merger that brought three of the nation’s largest cable providers into a single entity. The operations of Charter, Time Warner Cable and Bright House are now combined into a single entity under the Charter name, and they are the number three video provider in the market (behind AT&T/DirecTV and Comcast).
France-based Altice also has been acquiring cable properties in the US. In 2016, it acquired Cablevision after previously acquiring Suddenlink.
After purchasing DirecTV in 2015, AT&T is now pursuing the acquisition of Time Warner with the goal of acquiring content to support its video and other media offerings.
Verizon made plans to acquire XO Communications in order to obtain the competitive carrier’s spectrum licenses, which Verizon plans to use to support 5G wireless service.
Meanwhile, CenturyLink’s 2016 acquisition strategy was focused on gaining scale in the enterprise market. The company’s plan to acquire Level 3 Communications, announced in October, will make the combined company number two in the enterprise market, behind AT&T.
Although not known primarily as a communications provider, Google entered that market when it began deploying its gigabit fiber-to-the-home service in select markets several years ago. Google’s acquisition of wireless Internet service provider WebPass, completed in October, indicated the Internet giant is still interested in the service provider market, but that it is likely to shift toward a broadband wireless strategy.

The Federal Communications Commission's plan to allow rural rate-of-return carriers to collect Universal Service funding for stand-alone broadband may not achieve its intended goal of substantially reducing the cost of that service, cautioned Michael Romano, senior vice president of industry affairs and business development for NTCA—The Rural Broadband Association, in an interview.

Previously rural customers were paying an average of about $120 monthly for stand-alone broadband, while customers in urban areas were paying about $60 monthly for that service, Romano said. “This reform might help get [the rural price] more toward $100 or $110 per month, but not bring it to where it’s ‘reasonably comparable’ with an urban area,” commented Romano. Yet the goal of the nation’s Universal Service programs is to help ensure that citizens in rural areas pay rates that are “reasonably comparable” with those in urban areas. According to Romano, the reasonably comparable rate that the FCC has set for stand-alone broadband is just above $75. Traditionally the Universal Service program has focused on voice services and as Romano explained “Universal Service funds broadband-capable networks, but support was distributed based on customers’ purchase of voice services.” The upshot is that rural carriers often have had to charge comparatively high prices for broadband service. An FCC reform order adopted in March aims to change that by providing Universal Service support for stand-alone broadband purchased without voice service. Stand-alone broadband was just one element of the order, which had the broader goal of helping to bring higher-speed broadband to rural areas and to help ensure that all Americans have broadband available to them.