State Teams Up to Lift Lagging Broadband

ABSTRACT

Broadband, which deeply penetrates urban areas where telecoms can profitably lay the web of necessary wiring, provides Internet users with faster connections rich enough to carry the large pieces of information - like video and teleconferencing - that will dominate future business models. "With universal service support, Alltel and other wireless carriers are building facilities deep into rural areas, not just along major highways and delivering service to consumers where they live and work," said Scott Ford, CEO at Alltel Corp. of Little Rock, in his testimony at the Senate hearing.



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FUTURE ECONOMIC DEVELOPment in rural Arkansas largely depends on building out a highspeed Internet infrastructure that is near the bottom nationally.

The good news? Lawmakers and state officials say the framework has at least been laid to find a solution. The bad news? No funding has yet been earmarked and it's likely to be a while before any is found.

Officials at this point aren't even sure about what it might cost to improve Arkansas' ranking as No. 47 in broadband penetration. Telecoms say they simply can't afford to extend the network to far reaches, and there seems to be broad agreement that a public/private combo will be necessary to get the state up to speed.

Rural broadband awareness in Arkansas was boosted by the U.S. Senate Commerce Committee's choice to hold a recent field hearing in Little Rock, which was the first of its kind in the country. The Aug. 27 hearing was hosted by Sen. Mark Pryor, D-Ark. It featured leaders of several telecom and Internet providers, educators, students, top-ranking Federal Communications Commission members and technology gurus who spelled out the importance of solving rural Arkansas' broadband woes.

"The importance of broadband deployment cannot be underestimated," said James Winningham, deputy commissioner for information services for the Arkansas Insurance Department and a leader in Arkansas' broadband movement. "In its simplest terms, not having broadband is a lot like not having the roads and rural highway systems in place to access all parts of the state. It's the lifeblood of future economic growth, and we're currently failing a large portion of the state."

But that's all at least starting to change, officials say, as several initiatives are in motion to begin tackling rural Arkansas' broadband problem. Most of them were begun by the first piece of statewide broadband legislation, which was passed earlier this year.

Though the legislation makes way for a highly trained committee to oversee Arkansas' broadband woes and advance the cause, it did not include any key funding.

Winningham said the first crucial step to solving the problem is raising awareness of the issue while the funding gets figured out. After all, he said, if people in rural areas don't know the benefits of broadband, deploying it won't matter.

Most significantly, Act 604 of 2007 established a nonprofit backed by Arkansas Capital Corp. called Connect Arkansas. The stated goal of Connect Arkansas is generally to educate about, find funding for and facilitate growth of broadband in the state by being a centralized base for all things related to Arkansas' broadband push. The Arkansas Broadband Advisory Council will drive Connect Arkansas, and Act 604 states the council should be made up of one representative from each broadband provider in the state; three members appointed by the governor; three appointed by the president pro tempore of the Senate; and three appointed by the speaker of the House of Representatives. The Council is also charged with providing an annual report to Gov. Beebe through 2011.

Some of the state's students have also begun some groundwork.

The Arkansas Science & Technology Authority teamed up with EAST Initiative of Little Rock to deploy its technologically savvy base of students in rural Arkansas to lay the research groundwork for further broadband deployment in those areas that lack the necessary infrastructure.

Broadband, which deeply penetrates urban areas where telecoms can profitably lay the web of necessary wiring, provides Internet users with faster connections rich enough to carry the large pieces of information - like video and teleconferencing - that will dominate future business models.

Meanwhile, the state's library system, schools and hospitals are making due with what they have.

According to David Burdick, director of the Pine Bluff and Jefferson County public libraries, nearly all libraries in the state are connected to the Internet, but many rural libraries still have dial-up. Burdick said at least 10 in the state are on slow dial-up connections, while there are seven that still have no Internet service at all.

"We are letting our citizens down by not offering a fast and reliable connection to meet their needs," said Burdick.

Curtis Lowery, chairman of the department of obstetrics and gynecology at the University of Arkansas for Medical Sciences, said the state has aligned its major healthcare service organizations and have built the framework for a fullyconnected statewide telehealth system. But for it to be effective, broadband deployment will have to reach all parts of the state.

Lowery said at the Senate hearing that nearly $6 million will be needed to fully integrate the telehealth network.

Sen. Pryor said he's aware of broadband's role in medicine, schools and the economy.

"Today, broadband technology is driving innovation in fields like telemedicine, helping to provide quality health care to remote parts of our nation," Pryor said in a prepared statement last week. "It is transforming education, allowing our children access to ideas and information far beyond what the shelves of any school or public library might hold. And it is transforming our work force, increasing productivity and creating new economic opportunities for consumers and businesses alike."

Pryor said he is committed to broadband advancement in rural areas all over the country and that successful programs in other states that should act as models for those lagging behind.

Bluegrass Bandwidth

The Connect Arkansas program that grew out of the recent legislation will largely be modeled after Connect Kentucky, which has proven its worth in a state that is similar to Arkansas' rural landscape and geography.

Before the program began in 2004 in Kentucky, only 60 percent of households there had the option to subscribe to a broadband service. The program has boosted that number to 94 percent, and by the end of the year Kentucky will be the only state in the nation to boast of full broadband coverage. Adoption of the service in Kentucky, which means those households that have it available and choose to subscribe, has grown by 73% since 2004.

The Bureau of Labor Statistics says that as a result of Kentucky's broadband push, more than 15,000 technology jobs have been created, which is a growth unmatched in the nation.

"If Connect Arkansas is successful, the state as a whole will reap substantial and tangible benefits," testified Ed Allis, executive director of governmental affairs for AT&T Arkansas, at the Senate committee hearing last month. "Connect Arkansas has estimated that 8,200 jobs will be created and over $2.6 billion will be added to the gross state product annually."

Winningham said Connect Kentucky officials will he visiting the state and detailing how that state accomplished its turnaround. The key to Kentucky's success was finding a public/private funding mix that will be paramount to Arkansas' success.

The Arkansas Broadband Initiative, a group now chaired by Winningham, was initially the informal group that helped draft Act 607 and push for its approval. As a result of that legislation, ABI is now a formal committee that began meeting in August and will help steer Connect Arkansas. The legislation, however, included no funding. Leaders say the program will be funded by federal, state and private investments, beginning with asking the Legislature to set aside money in its next session, which is not until 2009. "It's no secret that Kentucky is a good model that we're going to aim at replicating," Winningham said. "The competition isn't among the states; it's more about where we are as a nation and how we fit into the global economic climate and ensuring that Arkansans can be a part of that."

Winningham pointed out that the United States, despite its power and wealth, is ranked No. 24 globally in broadband penetration.

ABI's stated goal is to "monitor the broadband based development efforts of other states and nations in areas such as business, education, and health; and to advise the Governor and the General Assembly on policies related to making affordable broadband available to every Arkansas home and business."

The council had its first meeting Aug. 27 and elected its leadership, but will begin getting to a meatier agenda when it meets at 9:30 a.m. Thursday at the Arkansas Capital Corp. Group building at 200 S. Commerce in downtown Little Rock.

Students Lead the Way

The EAST Initiative has been on the cutting edge of technology advancement and education for nearly a decade, and that's no different in terms of finding a catalyst for rural broadband deployment.

The Arkansas Science & Technology Authority teamed up with EAST in 2006 to form the EAST Rural Broadband Project, which operates through a $100,000 grant from the Winthrop Rockefeller Foundation.

A fundamental key to fully grasping Arkansas' rural broadband needs lies in accurately mapping coverage areas and potential customers. Ten rural EAST high schools began surveying businesses and families in rural communities last fall collecting vital data about Internet access (cost and satisfaction) and informing city councils and civic groups about the importance of collecting this information and entering it into a database that ultimately puts it into Geographical Information Systems form.

The preliminary data led to highquality county maps that give more detail and accurate readings than ever before. The students also wrote detailed business models for broadband deployment.

"We believe we proved what we set out to do with that program, which was most importantly raising broadband awareness in those communities, which is one of the greatest challenges in the state," said Matt Dozier, president and CEO at EAST. "By utilizing eager and technologically savvy 16year-olds, essentially, we got the ball rolling to reach a higher goal of giving every business and family in the state access to a broadband connection."

Business of Broadband

Though telecoms and Internet providers say it's just not economically feasible to invest the millions of dollars it would take to stretch broadband services to rural reaches, they do see the importance and are willing to find a solution.

Most agree that government funding and incentives will be the only way for companies to reach rural areas on a fair and competitive basis.

"We do not believe subsidies should be granted in the form of low-cost loans," said Maryce Cunningham, government relations manager at Sudden Link and secretary of the Arkansas Broadband Advisory Council. "We believe the process of closing the final inches of the digital divide will require direct government support."

The public-private bridge has already begun to be crossed, as the nonprofit Connect Arkansas program will begin receiving detailed coverage reports from telecoms and Internet providers in the state on a confidential basis, using that valuable information to form a better plan.

"There has to be some type of organized unified effort that levels the playing field across the state so that one company isn't making the kinds of investments into areas where their competition is not," Winningham said. "There needs to be a centralized effort, which I think Connect Arkansas will accomplish."

Business leaders also agree that the Universal Services Fund will have to be updated or expanded to include broadband. The successful fund was created in 1996 by Congress and requires telecoms to make monetary contributions to ensure customers in rural parts of the country have the same access to telecom products as urban areas.

"With universal service support, Alltel and other wireless carriers are building facilities deep into rural areas, not just along major highways and delivering service to consumers where they live and work," said Scott Ford, CEO at Alltel Corp. of Little Rock, in his testimony at the Senate hearing.

"Rather than continuing to target funds mainly to the traditional voice telephone services of the last century, the Universal Service Fund should be realigned to promote the ervices that consumers most need and demand going forward broadband and mobility."