Small Rural Providers Technology Transitions in Rural America

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Small Rural Providers

Small Rural Providers

Technology Transitions in Rural America v All Offering Broadband, But Not All Broadband is

Technology Transitions in Rural America v All Offering Broadband, But Not All Broadband is Equal q Platforms – 41% FTTP; 45% DSL; 12% Cable; 1% Fixed Wireless q Speeds – 67% >25 Mpbs; 20% >10 Mbps; 10% >4 Mbps v “Middle Mile”/Transit/Peering Challenges q Average 68 miles from Tier 1 ISP connections q Approx. 30 states with state networks v Access to Capital Issue, Business Case Issue, Bit of Both? q Challenge of 3 D’s is a Catch 22

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How Do Rural Networks Get Built? ($) v USF – key to business case;

How Do Rural Networks Get Built? ($) v USF – key to business case; does NOT finance networks q Reasonably comparable services and rates q CAF Phases 1 & 2, CAF-BLS/HCLS, Mobility 1 and 2, etc. [$4. 5 B ann. ] v Rural Utilities Service – banker for many rural BB projects q Finances networks (like other banks), but does not subsidize rates q Broadband Loan, Telecom Infrastructure, Community Connect, etc. v “Infrastructure Package” q Omnibus “Down Payment” - $600 M for loans/grants q Other plans? Not just funding; permitting/tax incentives too. . .

Interconnection Issues v Voice q TDM – straightforward (other than call completion), declining q

Interconnection Issues v Voice q TDM – straightforward (other than call completion), declining q IP – lack of rules/structure a help or hinderance? q Network Compensation & “Network Edges” – distance challenges v Data/Broadband q Netflix & other disputes q 2015 Wheeler Open Internet Rules q 2018 Pai Internet Freedom Rules q Prospect of legislation?

Nationwide Number Portability v Largely driven by small mobile operators q Counter to capabilities

Nationwide Number Portability v Largely driven by small mobile operators q Counter to capabilities offered on nationwide networks v Cost/Interconnection Issues q Who does dips (and bears costs for that)? q Who routes calls to where (and bears costs for that)? q New architectures (gateways, more transit, etc. )? q New governance needed?

Spectrum v Increasing Concentration q 700 MHz secondary market activity – one-direction q 600

Spectrum v Increasing Concentration q 700 MHz secondary market activity – one-direction q 600 MHz q Partitioning? v CBRS q Use cases q License sizes v 5 G q Small cells in rural markets = FTTH?