Survey Shows Rural Telecommunications Carriers Postponing, Delaying Network Upgrades Because of Regulatory Uncertainty
Arlington, Va. (February 19, 2013) – More than 100 small, independent telecommunications carriers have either postponed or cancelled plans to upgrade their network infrastructure as a result of regulatory uncertainty, according to a survey conducted by the National Telecommunications Cooperative Association (NTCA).
Results of the survey conducted in January show that more than two-thirds of participating rural telecommunications providers have either postponed or cancelled plans to conduct network upgrades because of uncertainty surrounding the FCC’s ongoing Universal Service Fund and intercarrier compensation reforms. NTCA members have expressed repeated concerns in particular regarding new caps that are based upon volatile, untested models and over the threat of additional cuts, caps and constraints on cost recovery that are still being considered by the FCC.
One hundred eighty-five NTCA member companies responded to the survey, which asked participants if they have postponed or cancelled network upgrades and, if so, to apply a dollar value to the investment subject to postponement or cancellation. Sixty-nine percent of respondents (127) indicated they have postponed or cancelled projects, and 101 respondents provided investment values totaling more than $492 million.
“The results of this survey reaffirm what we’ve known for quite some time: That limiting rural carriers’ ability to recover the cost of bringing high-speed broadband to our country’s most hard-to-serve areas is hindering efforts to plan and execute necessary network upgrades, resulting in millions of dollars in lost or postponed investments,” said NTCA Chief Executive Officer Shirley Bloomfield. “Ultimately, this troubling trend will mean fewer dollars flowing to communities for economic development and jobs, as projects continue to be put on hold or are delayed indefinitely.
“This is precisely the wrong direction that our country needs to be taking to stimulate our economy, and it undermines the national objective of making high-quality, affordable broadband available to every American through sustainable infrastructure investments.”
The results of NTCA’s survey mirror those of similar surveys conducted by two state telecommunications associations that showed a majority of their members were cancelling or delaying plans to deploy fiber in their service areas as a result of the new rules and those still being considered.
The National Telecommunications Cooperative Association is the premier association representing more than 580 locally owned and controlled telecommunications cooperatives and commercial companies throughout rural and small-town America. NTCA provides its members with legislative, regulatory and industry representation; meetings; publications and educational programs; and an array of employee benefit programs. Visit us at www.ntca.org.