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Mar 15 2017

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Chairman Pai Talks Digital Empowerment for Rural and Urban America Alike

In a speech today in Pittsburgh, FCC Chairman Ajit Pai picked right back up where he left off with his Digital Empowerment Agenda last fall, talking about a variety of coordinated measures aimed at bringing the benefits of broadband to every American. While it’s a package of measures, the great thing about the chairman’s agenda is it recognizes that the challenges facing Americans in terms of broadband access can and will differ by geography, economic circumstance, and other factors– so it’s a tailored package and not a “one-size-fits-all” take.

Because NTCA has seen broadband not only level the playing field but actually enable smart rural communities, we were excited to see the chairman’s continuing emphasis on his rural roots and his focus on the rural broadband challenge as an important part of the broader digital empowerment agenda. So while tax incentives may work and be really useful in some areas, for example, they won’t move the needle in many high-cost rural areas. Instead, focusing on what can be done to streamline infrastructure installation, paired with what can be done to support deploying and sustaining broadband in rural America, is such an important piece of the agenda too, and we are encouraged to see that remain an essential part of the conversation.

As I explained in my testimony to the Senate Commerce Committee a few weeks ago and as we highlighted in a letter to the National Governors Association back in December, we share the view that Chairman Pai has articulated about leveraging existing mechanisms such as the federal Universal Service Fund to direct additional resources that may become available and are needed for rural broadband. The problem we have seen increasingly over the past decade is not necessarily (or just) whether capital is available, but rather the growing problem has been justifying the business case for access to that capital from the lenders who have it available. USF is mission-critical to the business case of broadband in many hard-to-serve, sparsely populated rural areas. It is what enables providers in high-cost areas to sustain operations, to upgrade networks to keep pace with customer demand, and to keep rates affordable so customers can actually make use of the networks being built. But with lots of question marks in recent years in the USF program—and with a lack of sufficient USF funding being the most pressing problem today—it has become harder for smaller providers especially to make the business case needed to obtain any loans or other capital that’s available to enable rural broadband deployment. That’s why we’re so glad to see Chairman Pai’s continuing recognition of the potential for using the USF programs to promote both the availability and sustainability of rural broadband, and we’re eager to continue this conversation both as part of his Digital Empowerment Agenda and a broader national discussion about infrastructure investment.

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