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Experts: Withholding BEAD Funds Because of State Affordability Laws On Shaky Legal Ground

Legal analysts are questioning the recent assertion by the head of the National Telecommunications and Information Administration (NTIA).

NTIA administrator Arielle Roth said last week that the agency she oversees will withhold federal broadband deployment funds from states that have laws enforcing net neutrality or that have enacted affordable broadband legislation similar to New York’s Affordable Broadband Act.

As the assistant secretary overseeing the $42.5 billion Broadband Equity, Access, and Deployment (BEAD) program, Roth’s legal reasoning is striking.

All the more so given that the New York Affordable Broadband Act that requires Internet service providers in the Empire State to offer a low-cost broadband service plan to income-eligible households has been upheld as Constitutional – a case in which the Supreme Court twice declined to intervene and overturn.

Yet, last week in speaking before the conservative Hudson Institute, Roth offered remarks that have legal observers scratching their heads in bewilderment. During her speech, Roth said:

“Consistent with the law, which explicitly prohibits regulating the rates charged for broadband service, NTIA is making clear that states cannot impose rate regulation on the BEAD program. To protect the BEAD investment, we are clarifying that BEAD providers must be protected throughout their service area in a state, while the provider is still within its BEAD period of performance. Specifically, any state receiving BEAD funds must exempt BEAD providers throughout their state footprint from broadband-specific economic regulations, such as price regulation and net neutrality.”

The stakes are high for broadband affordability advocates across the nation. 

Superior, Wisconsin’s ‘Game Changing’ Open Access Fiber Network Goes Live

Superior, Wisconsin’s community-owned open access fiber network has gone live in its first two deployment neighborhoods, as the city works toward providing affordable next-generation fiber access to the city’s long under-served community of 26,000.

When we last checked in with Superior back in April, the city was working with Nokia for final configuration and testing before launch. Now, the municipal broadband network says its ConnectSuperior fiber network is live in its first two target neighborhoods in the northern part of the city (see the city’s latest deployment map).

The city’s open access network means that multiple broadband providers can compete over the same shared infrastructure. Historically such a model helps boost competition and drive down costs for both consumers and competitors. That’s already the case in Superior, where the city’s website lists two providers – Advanced Stream and Superion Networks – with more on the way.

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Superior Wisconsin UW Superior entrance

Advanced Stream is offering locals three tiers of service: a symmetrical 300 megabit per second (Mbps) tier for $63 a month; a symmetrical 650 Mbps tier for $75 a month; and a symmetrical one gigabit per second (Gbps) tier for $83 a month.

Superion is offering three tiers of service as well: a symmetrical 300 Mbps tier for $63 a month; a symmetrical 650 Mbps tier for $75 a month; and a symmetrical 1 Gbps tier for $85 a month. Both companies offer phone bundles for a modest additional surcharge.

Federal Reserve Study Offers Broadband Affordability Advocates ‘Novel New Measure’

Studies consistently show that the primary reason millions of households do not have home Internet service boils down to affordability.

Research by EducationSuperHighway indicates that of the estimated 28.2 million households in the U.S. that do not have high-speed Internet service, 18 million of those households (home to 48 million Americans) are not online because the cost of service is simply too expensive.

But now, thanks to a recently published study by the Federal Reserve Bank of New York, broadband affordability advocates may be able to more accurately measure the elusive nature of affordable broadband costs.

The study also examines how to better pinpoint contributing factors like the state of local infrastructure and how lower-performing broadband access technologies powerfully influence low-income households' decision to sometimes choose cellular service-only over home Internet service.

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A cornerstone is engraved with: Federal Reserve Bank of New York

Broadband Affordability: Assessing the Cost of Broadband for Low-and-Moderate Income Communities in Cities” provides a research-driven lens on how to measure broadband affordability neighborhood by neighborhood, city to city.

“While national and state-level analyses have helped highlight the digital divide,” the study’s author Ambika Nair writes, “measures of broadband affordability at the community level are limited.”

Cleveland’s DigitalC Gets $500K Google Infusion For Affordable Fixed Wireless

Innovative digital equity nonprofit DigitalC has been working for years to shore up affordable broadband access in underserved cities like Cleveland, Ohio. 

Now the organization is enjoying new momentum for its plans to expand fixed wireless broadband access in the city thanks to a $500,000 cash infusion from tech giant Google. According to a recent announcement, the donation includes next-generation Fixed Wireless Access (ngFWA) equipment from Tarana, which will allow DigitalC to expand its Canopy home broadband service – which provides symmetrical 100 megabit per second (Mbps) at $18 a month – to even more neighborhoods in Ohio.

The nonprofit just celebrated the connection of its 6,000th household in Cleveland, a city once ranked the worst-connected large city in the U.S. by the National Digital Inclusion Alliance (NDIA).

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Digital C worker on rooftop

“This meaningful investment from GFiber adds bandwidth to our capacity to scale the Cleveland Model,” DigitalC CEO Joshua Edmonds said of the cash infusion. “This community-based blueprint proves that next-generation technology can be deployed quickly, trusted deeply, and scaled effectively to deliver the superior internet experience more communities deserve.”

Minnesota’s Paul Bunyan Communications Shares $3.6 Million Windfall With Members

When it comes to community-owned and operated networks, better, faster, cheaper broadband is often only one of the benefits. Some telephone cooperatives, like Paul Bunyan Communications in Northern Minnesota’s Beltrami County, share profits with its members, literally paying the benefits of shared telecom ownership back into the communities they serve.

The Cooperative recently announced it was giving a $3.6 million profit windfall back to local community members. It’s the fourth such payout to local subscribers in the last seven years.

For distributions of $150 or less, a credit was applied to subscriber’s bills. For sums greater than $150, the cooperative mailed checks out to locals.

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Paul Bunyan Capital Credit voucher for $3.6

With origins that owe a part of its success to the Beltrami Electric Cooperative, it was in 1996 when locals were first offered broadband access through Paul Bunyan Telephone. Three years later, it began the necessary infrastructure upgrades that allowed it to offer phone, high-speed Internet access, and digital television.

In 2005, the cooperative expanded with fiber technology for the first time. In 2010, Paul Bunyan Telephone changed its name to Paul Bunyan Communications. 

“Our cooperative continues to grow and thrive, now serving over 35,000 active members across over a 6,000-square-mile service area,” said Paul Bunyan Communications CEO Chad Bullock.

“Through steady investment and expansion, we’ve built one of the nation’s largest rural all-fiber [networks], transforming how our members live, work, and play. It’s incredibly rewarding to see that success come full circle as we share the benefits with our members.”

California Regulators To Include Broadband Affordability Requirements In Verizon Frontier Merger Approval

The California Public Utilities Commission (CPUC) is poised to include new broadband affordability requirements as part of the state’s looming approval of Verizon’s massive $20 billion merger with Frontier Communications, even as some consumer advocacy groups worry the changes may not go quite far enough to hold Verizon accountable.

The CPUC’s Public Advocates Office has struck a partial settlement with Verizon that the state hopes will take some of the sting out of the telecom industry’s latest consolidation spree.

Verizon’s $20 billion proposed merger with Frontier would merge two of the nation’s top four traditional phone companies, resulting in a telecom giant with assets across 31 states. The merged new company would have more than 9.6 million customers with a fiber network that ultimately passes more than 25 million fiber homes and businesses.

While the two companies don’t directly compete, Verizon’s political influence and market power will still increase. Both companies have long been criticized for lobbying to undermine U.S. broadband competition, then leveraging the resulting regional market failure to jack up consumer costs and neglecting aging DSL network upgrades and repairs.

Massachusetts To Spend $31.5 Million On Broadband, Modernizing MDUs

*This is the first installment of an ongoing series we are calling Connected Complex looks at how states, local communities, and Internet service providers are working to address the often complex challenges involved in bringing high-speed Internet access to multi-dwelling units.

Massachusetts state leaders have announced a new $31.5 million investment to bring reliable, high-speed Internet access to residents in affordable and public housing statewide.

A key part of the major new investment initiative focuses on something that’s particularly challenging in the northeast: updating long outdated wiring in multiple-dwelling-units (MDUs) like apartments, condos, and housing developments, many of which were built before the advent of the Internet.

The funds are being provided by the Massachusetts Broadband Office’s (MBO) Residential Retrofit Program, which aims to deploy state-of-the-art broadband infrastructure to public and affordable housing properties across Massachusetts. MBI’s funding, in turn, was largely made possible by the 2021 American Rescue Plan Act (ARPA).

In partnership with the Massachusetts Broadband Institute (MBI), Gov. Maura Healey’s office awarded the grant money to four Internet service providers: Aervivo, Archtop Fiber, Comcast, and Community Broadband Networks FLX (CBN-FLX). All told, the funding is poised to deliver broadband access to 13,700 housing units across 60 Massachusetts municipalities.

Vermont’s ‘Long’ Reach Toward Affordable Broadband

As states struggle to readjust their plans to expand high-speed Internet access in the wake of the Trump administration “termination” of the Digital Equity Act, Vermont is working to address the multi-million dollar shortfall by aligning the state’s Digital Empowerment initiative with its newly established Affordable Long Drop Program.

The Affordable Long Drop Program was established to provide grants to eligible Internet service providers (ISPs) in order to cover the connection costs for Vermonters whose homes are beyond standard drop distances.

Typically, an ISP will pay for a standard drop, which is the final external link that connects a provider's distribution network to the end-user's location – a distance that most often spans a couple hundred feet or less.

In rural areas around the country, community-minded operators like telephone and electric cooperatives will often cover the first quarter of a mile. This has also been the case in Vermont, where many of the state’s Communications Union Districts (CUDs) have been footing the bill to cover as much as the first 2,000 feet of drop distance. But, as with any predominantly rural state, there are a number of homes located just beyond that 2,000 foot range.

The construction costs of extending fiber lines can get pricey the further the home is away from the main fiber routes. Vermont’s Affordable Long Drop Program aims to help pay for the drops costs of the last mile networks that are currently being built across the state to help ensure residents in harder-to-reach locations can still get Internet access.

Vineland, NJ Nabs $3.7 Million Grant To Begin Municipal Fiber Network

Vineland, New Jersey officials say they’ve secured a $3.7 million grant from the state that will help expand fiber and wireless broadband access to the city of 62,000. Local officials are hopeful the grant is just the beginning steps toward dramatic expansion of affordable access.

Vineland’s new grant was made possible by the New Jersey Broadband Infrastructure Deployment Equity (NJBIDE) grant program. NJBIDE will be delivering $40 million in broadband grants via the state’s Capital Projects Fund (CPF), made largely possible by the 2021 federal passage of the American Rescue Plan Act (ARPA).

NJBIDE grants prioritize fiber optic infrastructure of 100 megabytes per second (Mbps) and mandates the provision of at least one low-cost option (not specifically defined by New Jersey) to serve low income communities – something increasingly important in the wake of the federal government’s retreat from efforts to ensure equitable and affordable broadband. (Still early in the process, the city has not yet determined the exact pricing and service tiers the network will offer once construction is complete).

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A map outlining proposed network in Vineland NJ

A 2024 city proposal indicates that city leaders want to spend between $35 and $40 million to create a citywide broadband network, starting with a citywide fiber ring. The city paid for a viability study from Bonfire that found that at least 42 percent of the City does not have access to viable, quality, affordable broadband service.

Bountiful, Utah Finishes Muni-Fiber Network A Year Ahead Of Schedule

Officials in Bountiful, Utah say they’ve completed the city’s $48 million open access fiber network a year ahead of schedule, bringing fast, affordable broadband access to the Salt Lake City suburb of 45,000.

“We have completed the Bountiful City fiber project and built out the entire city with an open access network,” Utopia Fiber Executive Director Roger Timmerman recently said at the Fiber Connect Conference in Nashville, Tennessee. “This was a three-year project, and we completed it nearly a full year ahead of schedule.”

In a unanimous city council vote in the summer of 2023, officials approved $48 million in bonds to fund construction of the city-owned open access fiber network. 

Like UTOPIA’s broader network, the city then leases access out to numerous independent ISPs, creating a massive influx of competitive, affordable last mile fiber access.

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Bountiful map

The city of Bountiful owns the network while UTOPIA designed, built and manages the network and takes a share of the revenue.

Thanks to the partnership, locals now have access to 14 different competing broadband providers, offering symmetrical and affordable 250 megabit per second (Mbps), 1 gigabit per second (Gbps), 2.5 Gbps, and 10 Gbps tiers – plus a $38 to $44 local network access charge.

UTOPIA officials say the network currently passes around 16,500 addresses, and they’ve been seeing 200 signups per month.

“We need a year to really answer that question,” Timmerman said when asked for specifics on area adoption rates. “In Bountiful we’re confident we’ll get take rates of 40% or higher. There’s a lot of demand there.”