ISPs to Senate: Limit RUS Overbuilds

Cable operators and other broadband providers want to use the Farm Bill to remove a long-time thorn in their sides, broadband subsidies that allow for major overbuilding of existing providers.

In a letter to the chair and ranking members of the Senate Agriculture Committee, the heads of the National Cable & Telecommunications Association, the American Cable Association, USTelecom, and ITTA-The Voice of America's Broadband Providers, said that while they are considering the new Farm Bill, they should consider reducing the allowable overbuilding in the Rural Utility Service broadband loan program.

Helping light a fire under the push for change is that Congress, in the RAY BAUM's Act, made $600 million available for rural broadband deployment, which will be administered through RUS.

The RUS program only requires 15% of an applicants targeted service area to be unserved, meaning 85% of the funds could be used to build where therea are already up to two providers.

"This practice does nothing to help those in rural America who still don’t have broadband service. Additionally, this government subsidization of a competitor in a market already served by one or two providers is an inefficient use of scarce funding and puts a thumb on the competitive scale, undermining future efforts to sustain existing networks or to build out broadband networks in high-cost areas, especially when those networks are built with private risk capital," they told Sens. Pat Roberts and Debbie Stabenow, chair and ranking member, respectively, of the committee.

NCTA et al. want the Senators to use the bill to modify RUS to limit funding to areas where 100% of residents have no broadband service (defined as no service of at least 10 Mbps downstream, 1 Mbps upstream), or where at least 90% don't have such service.

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.