Regulating Prices for Business Data Services Will Widen Network Gap Between Urban and Rural America

Forbes By Congressman Rick Boucher

The Federal Communications Commission (FCC) is preparing to foist new rate regulations on the “business data services” (BDS) market, the dedicated broadband links that provide Internet access to businesses of all sizes. Unfortunately, the proposal has many shortcomings, and it would impose – for the first time – regulations on new fiber infrastructure in an expanding and well-working market that is attracting new service providers as competitors…but its most detrimental effects would be in rural America.

As the representative for 28 years of Virginia’s most rural and mountainous congressional district, I came to an early appreciation of the unique barriers that make developing advanced communications networks in rural areas highly challenging. First, thin population density means that the fiber-optic lines must traverse longer distances to serve fewer people than comparable investments in suburban or rural areas. Secondly, challenging terrain, particularly in mountainous areas, dramatically increases deployment costs. Third, with rural incomes generally lower than metropolitan area incomes, once modern networks arrive, there are often fewer subscribers per capita within the local population than the national average. Consequently, rural networks are deployed more slowly, and advances in network capability come later than in metropolitan areas, producing an existing rural versus urban deployment gap in 4G LTE services.

Telecom policymakers at every level of government and at the FCC must keep these realities firmly in mind. If they fail to do so, the challenges of developing rural networks inevitably become even harder. The FCC’s pending BDS regulation is, regrettably, a glaring example of rural reality nonobservance.

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investinbbandRegulating Prices for Business Data Services Will Widen Network Gap Between Urban and Rural America