Summary
1. We have consistently said that there is no attraction to “very rural” areas by large carriers. 2. As the source article points out, it is not just a matter of the first cost being handsomely subsidized. 3. It is that “much of telecom carriers’ costs are operational and persistent long after infrastructure builds are complete.”
Analysis
As the source piece states, “there really is no such thing as free money.” Along with the strings that will be attached that will ultimately affect the overall economics, the prospects for making sufficient profit for the Bells in the tier 4 space is just not there. In some situations, we are talking about providing service within a mile where the number of homes is in the single digits. In others, it is about serving farms separated by several miles.
A year ago, we wrote “universal service needs to become universal broadband service.” Getting broadband to non-served areas will fail to occur without government mandates to service providers of all types.
It is also unsurprising that “so many of those chasing broadband stimulus funds are not profit-seeking entities.” In the past, telco cooperatives have taken advantage of a good amount of government subsidization to provide fiber to the home.
