This past May Governor Kay Ivey signed in to law the Alabama Broadband Accessibility Act (ABAA) which was sponsored by Clay Scofield (R-Arab). While the intentions and goals of the Alabama Legislature and the Governor are noble and what we as a state should be striving for, the state needs to be thinking outside the box and thinking of creative ways to solve the problem of limited access to broadband internet. The internet and access to broadband speeds are quickly becoming the backbone of the American economy, and an essential tool to the survival of any community. The ABAA set up and funds a grant program that allows the state to award grants to the telecommunications company that invest in expanding and upgrading their networks in rural areas to provide broadband speeds. This is a good first step, as those networks are the backbone of any internet infrastructure, but it’s going to take more to ensure that our rural communities in this state have consistent and affordable access to broadband speeds.

Economics of internet network infrastructure

To be able to fully solve the problem of reliable access to broadband speeds in rural communities, The state has to recognize and understand that it is just not economically feasible to run fiber optic cabling to every nook and cranny in the state. While it is true the grant provided by the ABAA will make it more economical for telecommunications companies to provide broadband speeds to more communities, those economics will not reach very far outside of the cities or towns of this state.

In an economic feasibility study, Microsoft determined that for areas with less than 2 people per square mile (PPSM) satellite internet is the best way to deliver broadband speeds. While the companies that offer satellite internet services vary in the packages they offer, they do offer a viable option for areas where it just isn’t feasible to run the necessary infrastructure to offer wire based services.

In that same feasibility study, Microsoft determined that the most economical way to deliver broadband speeds to areas that have between 2 and 200 PPSM is through Wireless Internet Service Providers (WISPs). This is an emerging area of broadband access that got its start in densely populated urban areas that could work well in many parts of Alabama.

For areas with a PPSM over 200, Microsoft’s study indicates that direct to the home fiber networks are the most economical way forward.

How the Government Can Help

If government wants to have affordable and readily available access to broadband internet in rural communities, they need to work together in a coordinated effort to ensure an open and competitive marketplace among the different types of technology to ensure that people can choose the best option for them.

Federal government

One of the best ways that the Federal Government can help promote the expansion of broadband access in rural communities is by incentivizing telecommunication companies to invest in that expansion.  The best tool that the Federal Government has to accomplish this is the tax code.  Even though these rural communities are small, a lot of times the phone lines and cable lines are owned by multibillion-dollar firms like AT&T or Comcast.  While states and cities can offer financial incentives to spur investment, offering these firms a Rural Broadband Investment Tax Credit on their federal taxes would encourage them to accelerate that investment in multiple communities.  Tax credits are a better way to encourage telecommunication firms to make those investments than grants because Tax credits compensate for money already spent rather than promising taxpayer money for future money that might be spent. 

Another way the Federal Government is helping is by working with the Federal Communications Commission (FCC) to reserve frequencies throughout the country for a WISP technology called TV White Space Wireless (TVWS). TVWS is a type of wireless broadband technology that uses frequencies formerly used by analog TV Stations and the “white space” between current TV Stations to provide internet at broadband speeds wirelessly. The reason why this technology could work well for places like Alabama is because the speeds can travel longer distances on these frequencies.  This allows local Internet Service Providers(ISPs) to base their wireless towers in areas with a larger population density, where investing in Fiber-to-Home Networks is economical, but allow for the faster speeds to reach areas where it is not as economical to run those networks.  The Federal Government, through the tax code could offer faster depreciation tables for the purchase of equipment and installation of these type of networks, offer even more incentive to deploy these types of technology around the country.

The State Government

The Alabama Broadband Accessibility Act was a good start at solving the issue of a lack of affordable access to Broadband speed internet.  The state doesn’t need to stop there.  Like the Federal Government, the State needs to offer Telecommunication companies that invest in upgrading their networks a tax credit on their state level corporate taxes to reward companies that make those investments.  It also needs to offer accelerated depreciation tax tables as well for companies that invest in new equipment, especially for companies that introduce new technologies that offer creative solutions to offering higher internet speeds in rural communities. 

The state also needs to ensure that their regulations for satellite internet companies to enter the ISP marketplace are fair, open and the least restrictive as possible, while not giving them an unfair advantage over other providers in the marketplace.  Many local Internet Service Providers will argue that they have invested millions in their networks and their communities and Satellite providers have not.  This is true but shooting a satellite into space strapped to a rocket isn’t cheap either. 

Local Governments

Local Governments can ensure a fair and competitive marketplace for broadband providers and consumers alike by writing the Franchise Agreements, contracts between the government and the companies allowing them to operate in a given area, in way that allows for competitors to move into a community to compete, or allow the government to cancel an agreement if a provider isn’t providing fast speeds and quality customer service.

The internet is quickly becoming an interictal part of all aspects of life in the United States of America.  This is no different in the rural communities of our country.  Even farm equipment and tools are becoming connected.  This doesn’t even take into consideration the benefits that are offered to local community colleges and community hospitals that are in a small town or rural communities throughout Alabama.  The state has started to take steps in ensure those communities aren’t left behind by the emerging and changing economy, but it’s time that we do more.

David Preston
David is a small business owner and contributing columnist to BamaPolitics.com. He attended the University of South Alabama and studied political science. He ran for his first and only political office in the city of Daphne, Alabama for city council where he lost by less than 200 votes to a sitting incumbent. David has a passion for all levels of politics, aviation, business development and recruitment, history (his dad drug him to Civil War battlefield for Summer vacation instead of Disney world and six flags) and the Mobile region.