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NCTA, Eagle Express Concerns Over Broadband Grants

The National Cable & Telecommunications Association and member company Eagle Communications are concerned that the government broadband stimulus program is underwriting overbuilders rather than targeting truly unserved areas, and have asked the government to review one of its multimillion-dollar broadband grants.

It is the first time NCTA has called for a review of one of the grants in the $7.2 billion broadband stimulus program, though individual companies have raised concerns.

In a letter to the heads of the National Telecommunications & Information Administration and the Rural Utilities Service, NCTA President Kyle McSlarrow registered concern about a $101 million broadband grant in Kansas.

Enclosing a copy of a letter from Eagle President Gary Shorman, McSlarrow said there were indications that the stimulus awards "are not being made with full awareness of marketplace realities."

Shorman indicated the reality was that while the grant was supposed to go to an area 99.5% unserved or underserved, much of the money is going to Hays, which he says is "already one of the best-served communities in western Kansas."

McSlarrow says it will wind up overbuilding Eagle's broadband operations in that "non-rural" area.

"It simply cannot be the intent of this program for funding to be used in a way that devotes scarce federal resources to communities which already have access to broadband when there are other communities in the United States with no access," wrote McSlarrow. "Moreover, at a time of economic hardship, public policy should not threaten the livelihood of a small, local business that has invested millions of its own private capital to deploy a host of advanced broadband services."