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Economic Opportunity for Broadband with Rural Electric Co-ops

Co-ops have the chance to support education, healthcare and work-from-home coming out of the coronavirus pandemic.



Drew Clark and Darren Farnan

March 2, 2022 – The chief operating officer of a rural electric coop that expanded into the broadband business by using its existing electric infrastructure said it has seen the new business outpace its existing one, which it said goes to show the importance of using existing poles to connect rural Americans.

Darren Farnan of the Missouri-based broadband provider and electric co-operative United Fiber, said his company has also seen a rapid uptake in higher-speed internet packages during the pandemic, with 60 percent of his company’s new customers now taking 500 megabits per second or one gigabit per second download service.

“It was such a game changer with Covid,” said Farnan on an Ask Me Anything-style interview with Broadband.Money on Friday, adding the company hopes to upgrade capacity and begin offering two, five and 10 gig service. “I mean, we thought we were busy and a lot of demand before and then that just blew the roof off.”

United Fiber has seen much more prosperity in its electric business from the success of its broadband provision, Farnan said, taking advantage of what it believes to be unique circumstances under which it is the only rural electric co-op in the which has more broadband subscribers than it does electric customers.

Farnan also said he feels that United Fiber has brought much needed internet service to areas of their electric footprint where rural telephone co-ops failed to provide service, including many smaller communities adjacent to the areas served electrically. He added that 92 percent of the persistent poverty counties in the U.S. are served by electric co-ops.

Entering the broadband business

This earlier lack of access for customers brought United Fiber into the broadband business almost accidentally during the days in which it was just an electric network, Farnan said.

Federal funding was essential to United Fiber’s foray into broadband, but many other co-ops have been able to make such expansions to their service using only their own funds as the co-op broadband model becomes more prevalent in other states, he said.

Earlier this year, Chris McLean, the acting Rural Utilities Service Administrator, said over the past two fiscal years, his agency funded more miles of fiber than power lines.

The company aims to take as active a role as possible in the communities it serves to ensure a profitable local economy – introducing initiatives such as rate discounts, particularly in December to help customers with their holiday spending, Farnan said.

Even with increasing broadband membership, United Fiber still views its electric service as essential due to increasing demand for things such as electric cars and does not anticipate phasing it out of distribution.

“Like I said, we’re unique, when you mention the tail wagging, the dog, it’s a little bit unique for us because we’re, like you said, three times the number of customers,” said Farnan.

“And we just try not to put labels on it, right? Our mission is to basically take care of our members and take care of the region, so we just look at it that way and it really benefits all.”

Watch the Ask Me Anything! interview with Broadband.Money on Friday, February 25, 2022, on Broadband.Money.

Reporter T.J. York received his degree in political science from the University of Southern California. He has experience working for elected officials and in campaign research. He is interested in the effects of politics in the tech sector.


FCC Commissioner Carr Criticizes BEAD Fiber Priority Ahead of Funding Allocation

The NTIA has acknowledged a clear preference for fiber in its bipartisan infrastructure deployment effort.



Photo of FCC Commissioner Brendan Carr in Feb 2018 by Gage Skidmore used with permission

WASHINGTON, May 31, 2023 – Brendan Carr, commissioner of the Federal Communications Commission, voiced reservations last week about the fiber preference in the National Telecommunications and Information Administration’s flagship broadband funding program, citing potential time and financial constraints.

The NTIA’s Broadband Equity, Access, and Deployment program, an offspring of the Infrastructure, Investment and Jobs Act, is expected to deliver $42.5 billion to the states by June 30 for infrastructure that needs to be built within a handful of years. Funding priorities under BEAD will be given to “projects designed to provide fiber connectivity directly to the end user,” according to an NTIA document.

“I do think some of the BEAD policies put a bit too much of a thumb on the scale for fiber,” Carr said in an interview with John Foley, managing director of Safer Building Coalitions, at the Wireless Tech and Policy Summit in Washington.

“In the case of fiber, where it could take potentially years to get fiber built out, not to mention significant delta in funding,” said Carr. “It can take anywhere from $40,000 to $60,000 to run a mile of fiber.”

He said fixed wireless access can sometimes provide “robust high-speed service” while still remaining within budget.

Despite the NTIA’s clear acknowledgement of a fiber preference in its infrastructure deployment effort, Carr has long advocated for the use of fiber alternatives in rural regions, where high-speed internet is still a luxury in some parts. In 2022, Carr criticized the FCC for rejecting full grants to satellite broadband service provider Starlink and fixed wireless service provider LTD Broadband from the Rural Digital Opportunity Fund.

“We should be making it easier for unserved communities to get service, not rejecting a proven satellite technology that is delivering robust, high-speed service today,” read the statement. “To be clear, this is a decision that tells families in states across the country that they should just keep waiting on the wrong side of the digital divide even though we have the technology to improve their lives now.”

Among the summit’s panelists, former FCC Commissioner Jonathan Adelstein also raised skepticism that the program’s intended beneficiaries, those living in rural regions, would see any tangible benefits from a fiber priority strategy.

“Policy makers, I don’t think, are always thinking about how actually consumers are living on the ground,” he said. “The thing that isn’t so obvious sometimes is the affordability factor that not everybody can afford to have a fiber connection and a broadband connection over their handset.”

This isn’t the first time telecom experts raised concern about BEAD’s fiber-focused expansion. The Wireless Internet Service Providers Association released a report in February calling fiber-prioritized financing “a bad policy” due to its potential to raise implementation costs and slow down the rollout timeline.

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Utah City Approves UTOPIA Fiber Build

UTOPIA continues to expand open access model builds.



Photo of Bountiful City Hall

BOUNTIFUL, May 24, 2023 – The city council in Bountiful, Utah, voted unanimously to approve the building of a city-owned fiber network by Utah-based service provider UTOPIA Fiber Tuesday. 

The open access fiber infrastructure will be owned by the city but operated by UTOPIA Fiber, which will then lease the fiber to internet service providers. 

City council members expressed their resounding support for the program. We believe that the estimates of take rates are conservative and reasonable when compared to like communities, said City Manager Gary Hill, pointing to neighboring town Centerville that has 49 percent take rate on its city-owned network. 

Bountiful will issue $43 million in bonds to fund the program, announced the city. The debt service for the bond will be paid for using system revenues with any excess revenue invested into affordability assistance, city council members said.  

The initial contract term is 10 years with buildout expected to take 2-3 years. The city anticipates that it will make profit on the investment within four to five years of operation. 

In 2022, at the request of residents, the city issued a request for proposals that were released to potential fiber providers to build and operate a city-owned network. In January, Bountiful officials began contract negotiations with UTOPIA. 

“The purpose of the City’s involvement with fiber is to provide a competitive marketplace for internet service providers through an open access network,” read the city’s statement.  

The announcement comes months after West Haven, Utah announced its contract with UTOPIA Fiber for a city-wide network. 

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Open Access

AT&T Closes Open Access Fiber Deal With BlackRock

In a new joint venture, AT&T will expand its fiber network across the nation.



Photo of Christopher Sambar of AT&T

NEW ORLEANS, May 12, 2023 – AT&T is set to invest several million dollars of capital into fiber builds across the country as it announces the closing of its joint venture deal with fund manager BlackRock, the company said.  

In December, AT&T and BlackRock announced the formation of their joint venture, Gigapower LLC, to operate and deploy a fiber network to 1.5 million customers using a commercial open access platform.  

The deal between the companies closed Thursday. According to the press release, the new company’s goal is to “create the United States’ largest commercial wholesale open access fiber network to bring high-speed connectivity to more Americans.” 

“We believe fiber connectivity changes everything. That’s why we’re already one of the biggest investors in fiber in the United States,” said John Stankey, CEO of AT&T in a statement.  

“The demand for high-speed connectivity is unprecedented, and through this innovative partnership with BlackRock, one of the world’s foremost investors in infrastructure, we’re able to connect even more people and businesses, accelerating our efforts to help close the digital divide,” he said. 

Gigapower will enable AT&T to expand its fiber reach beyond its traditional areas and spread across the country, read the press release. BlackRock brings significant expertise and capital to support the buildout. 

The company expects to expand into Las Vegas, Nevada and areas of Arizona as well as Northeastern Pennsylvania and parts of Alabama and Florida that are currently outside of AT&T’s service areas. 

Christopher Sambar, executive vice president of AT&T, said in a Connect (X) event Wednesday that the company has already invested millions of dollars to build the most expansive fiber network in America.  

Between 2018 and 2022, AT&T invested $120 billion into the US economy via capital expenditures, he said, making the company one of the largest capital investors in America. 

Fiber is the backbone of wireless and 5G technology, he said. It is essential that the industry builds the foundation of fiber to support 5G and enable further innovations in the technology. 

According to Sambar, well over 170 million customers are being serviced with high-speed 5G networks and close to 300 million are serviced with speeds close to 5G.  

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