Gordon Smith: Can a 5G Fund Connect Rural America at 21st Century Speeds?

Last month, Federal Communications Chairman Ajit Pai announced a new plan to allocate $9 billion toward deploying 5G wireless in America’s rural areas. From these funds, $1 billion would be earmarked for precision agriculture.

The 10-figure sum is impressive, but it’s not all new money. Pai would repurpose $4.5 billion already allocated for a rural 4G build-out. The actual investment boost amounts to about $450 million per year.

The funding targets and the program details are, however, subject to change, especially as public comments roll in. Nonetheless, telecommunications companies, resellers, and consumers are eager to move forward.

The question is whether this plan can overcome the problems of previous rural connectivity initiatives. The failings of the Mobility Fund for 4G was the topic of an FCC report unveiled alongside Pai’s 5G announcement. This study confirmed what many rural leaders and residents have been saying—that they haven’t received as much improvement in mobile access as they’d been told.

The problem and promise of rural connectivity

Rural telecommunications access is an enduring issue. After almost a century of investment in universal service, the U.S. has not managed to bring telephone, let alone data, to all households. As late as 2018, 8 million adults and 2.4 million children lived where no telephone service—landline or mobile—was available.

This represents a severe impairment in today’s increasingly digital economy, as do the limited, dial-up speeds provided to approximately 35 percent of rural Americans. Against this backdrop, cell service offers great hope. Just like developing countries expect to “leapfrog” landlines to deploy advanced wireless technologies in their stead, rural America desperately wants to put its faith in 5G.

The promise here is difficult to overstate. Precision agriculture alone—leveraging remote sensors, GPS, self-driving farm equipment, and so on—could radically reduce wasted seed, fertilizer, and fuel while increasing yields.  This is how the breadbasket of the world will help feed a burgeoning population.

Equally important would be gains in education. Digital technologies can bring advanced courses and targeted services, from interactive computer programming classes to special needs counseling, to remote schools that struggle to support the specialized staff.

Better connectivity would also accelerate small towns’ economic development and reduce the need for domestic migration to large cities, as businesses take advantage of the often-underutilized labor pool and lower costs when bringing jobs to these “forgotten” areas. And the benefits would extend to aging local populations, with telehealth to complement traditional medicine and online interactions to combat social isolation.

Unfortunately, the leap to 5G is not as simple as it may sound. The Mobility Fund to implement 4G was plagued by problems. An FCC report found rampant overstatement of access improvements and connectivity speeds delivered under Phase I. Even as the U.S. looks to replace Mobility Fund Phase II with a 5G Fund, there are technical and policy challenges that could, if not properly accounted for, exacerbate issues with federal broadband investment.

Questions about the FCC’s new direction

There are any number of details to be finalized, but the following represent four critical questions, which can help determine if the FCC plan comprises a viable solution for our rural areas.

#1 Will leapfrogging work?

First off, is it feasible to skip 4G and LTE? Some say not. Various state-level leaders consider the abandonment of 4G plans a “slap in the face” to their communities. They bemoan the likely delay of implementing even basic mobile connectivity in severely underserved communities. Furthermore, focusing on 5G could undermine the ultimate goal of connecting rural areas if the technology and implementation are not up to the specific challenges in these geographies.

In reality, 5G adds new technical issues. Its extreme line-of-sight limitations will be felt in urban areas and cannot be avoided in the hollers of Appalachia or well-forested parts of Idaho. Also important is range. 4G carries about 10 miles, 5G about 1,000 feet, at least at the frequency band the three largest US carriers are building. The requisite stations for 5G are not as large or as power hungry, but they would still need to be deployed across nearly three-quarters of the nation’s landmass representing our rural areas—about 1.75 billion acres. That makes a $9 billion investment look awfully inadequate.

One might argue that a complement of technologies would do a better job of rapidly meeting rural residents’ needs. This might mean using 4G and LTE for remote residential coverage and initially concentrating 5G in small towns where businesses and people congregate. Such alternatives to an “all 5G” approach deserve to be explored.

#2 Is the fiber foundation adequate?

More so even than 4G LTE, 5G demands fiber. South Korea has a lot of it, and the country was able to reach 2 million 5G users within four months. In the U.S., on the other hand, those 5G-enabled football stadiums we keep hearing about still aren’t performing reliably.

A 2017 Deloitte study estimated that building a robust fiber network across the U.S. would cost about $80 billion. Private investment is unlikely to address the needs in rural areas, at least in the near-term, without more government support but will it be forthcoming? Due to this issue, various organizations, such as the Electronic Frontier Foundation, may continue to argue for last-mile fiber to the home as the more important step forward.

#3 How will maintenance be handled—and funded?

Another consideration, it is not only more difficult and expensive to build telecommunications capabilities in frontier regions, maintaining and repairing these networks is also very costly. When a single truck roll might comprise a hundred-mile journey or more, the combination of transportation costs and field technician time rapidly add up—frequently to more than the served population supports with their monthly bills.

It will be relatively useless to deploy 5G across rural America without plans for maintaining the networks over the long-term. This will likely require public investment along with industry innovations in the areas of monitoring and maintenance optimization. Powerful tools that tap business intelligence and data analytics, machine learning, and eventually AI will be critical in spreading available dollars further while maximizing uptime in rural cell service.

#4 Can oversight be improved?

Oversight is another important question, especially after revelations about the Mobility Fund Phase I’s shortcomings. Resellers, consumers, and taxpayers have every reason to demand increased transparency and accountability.

Telecommunications companies will, of course, want to see flexibility in the metrics targets for which they will be held accountable, their reporting responsibilities, and the government’s enforcement mechanisms. The FCC will most certainly be receiving comments about carriers’ needs to respond to actualities on the ground and ensure administrative concerns do not drain funds from actual 5G deployment. Telecoms will also be highlighting the many failures in reporting protocols that contributed to inaccuracies in Mobility Fund assessments.

Next Steps

The public comment period doesn’t close until April 30, so there is little choice but to take a wait-and-see attitude for now. But America’s global competiveness is on the line, so it would behoove industry experts and consumers alike to weigh in on the 5G Fund. Only with diverse insights from across the country can the FCC shape smart policy to cost-efficiently build what our rural communities need to survive and thrive—world-class broadband.

About the author:

Gordon Smith is the President and CEO of Sagent, where he has developed customer programs, built industry partnerships and expanded service offerings for telecom carrier and cable MSO networks. Prior to joining Sagent, Smith was vice president of services at Tempest Telecom Solutions. He is a licensed professional engineer and holds a master’s degree in business administration from Goizueta Business School at Emory University, as well as a bachelor’s degree in civil engineering from the University of Waterloo in Canada.

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