Advanced telecommunications services are providing an economic and quality of life bridge to the American mainstream for many rural regions which have been characterized by under-investment on the part of traditional sectors of the nation’s economy.

A rapidly improving telecommunications infrastructure is enabling businesses which were once centralized to decentralize. Companies which have viewed as a necessity their presence in an urban area in order to maintain close communications with their customers and suppliers are now finding it possible to place major portions of their businesses in rural regions which offer few traffic jams, abundant employees, and lower business costs ranging from cheaper real estate and less expensive electricity to significantly lower personnel costs. With broadband Internet connections, companies with widely dispersed operations can conduct business as efficiently and at a lower cost than the completely centralized operations of the last century.

While optical fiber lines provide broadband connections on a national scale, many smaller communities must still rely on slower links. Moreover, wireline broadband services are often priced beyond the reach of smaller businesses, and few residences have the luxury of broadband connections. Cable modem services and the telephone industry’s DSL offerings are making a slow but steady contribution to closing this gap, but at the present time there are less than 2 million subscribers to these services combined.

Complete nationwide coverage for affordable broadband services will soon arrive courtesy of the nation’s direct broadcast satellite (DBS) providers, enabling business to be conducted and high-speed Internet access to be enjoyed from the most remote locations in the nation. The advent of this service will add to the quality of life for rural Americans and enhance the attractiveness of smaller communities as business locations.

At the present time it is possible to subscribe to an Internet-access service delivered by satellite; however, while the bandwith from the satellite to the home receiver is reasonably wide (approximately 350 kilobits per second) the path back to the satellite is both narrow and costly. In fact, the path back to the satellite is over a telephone line, typically operating at 56 kilobits per second or less for which an additional Internet access subscription is required. Accordingly, the system has significant bandwith limitations and requires separate Internet access subscriptions from the satellite company and from a wireline Internet access provider. Given these limitations, it is little wonder that the satellite-based Internet access services have not enjoyed wide acceptance.

All of that is about to change. Currently undergoing testing is a technology which will enable direct two-way communications for Internet access between the satellite and the subscriber. A small transmitter will be placed on the satellite dish which will enable the uplink to the satellite to occur along the same pathway as the downlink from the satellite. Accordingly, the wireline Internet access subscription can be eliminated, and the bandwith between the customer and the satellite can be broad in both directions. With this advance, the DBS companies can enter the Internet access market as full and viable competitors with the remarkable advantage that their nationwide footprints will enable them to serve small communities and remote homes that have no other broadband alternative.

The DBS companies currently offer hundreds of channels of video programming. With the changes in the Satellite Home Viewer Act enacted last fall they now have the legal authority to provide local television signals as well as their traditionally offered national programming. Legislation which I authored strengthens the financial case for the satellite companies to offer local television signals not only in the largest cities but in all 211 local television markets nationwide. This legislation was overwhelmingly passed by the House of Representatives earlier this month, and a similar Senate measure was recently passed as well. Passage of a final version of this legislation is on a fast track in both houses, and approval of the measure is anticipated later this year.

The provision of local television signals along with national programming positions the satellite industry as a viable competitor to the cable television industry. Satellite carriers can now offer exactly the same programs being carried on cable with a digital signal quality typically superior to that offered on analog cable systems. This advance signals a new era for the receipt of television programming by rural residents who reside beyond the reach of their local television stations. Even television viewers who elect to keep their cable subscriptions will be benefited since cable TV rates will now be governed by the forces of a competitive market. The new interactive Internet services to be offered by satellite will open the door to a range of new business opportunities for rural Americans and will enable the delivery over the satellite of Internet telephony, generally referred to as voice over IP.

We can, therefore, forecast that within approximately one year the direct broadcast satellite companies will be full multi-media, multi-service providers offering not only hundreds of channels of television but broadband Internet access and telephone services as well. With these advances, the direct broadcast satellite companies will truly become an economic and quality of life bridge for rural Americans.