Study Finds ‘No Critical Shortage’ of Broadband Service in Rural America;Explodes Myth That Only Large Incumbent Local Exchange Carriers Are Capable of Building Broadband Networks in Rural and Non-Rural Areas
NASHVILLE, TN, May 4, 1999 – Competitive service providers are driving deployment of advanced telecommunications services in both urban and rural areas, according to the findings of a new study released by the Competitive Broadband Coalition, a group representing associations and companies that provide competitive broadband services.

The study, by noted telecommunications economist Dr. Lee L. Selwyn, president of Economics & Technology, Inc., reviews competition in broadband deployment since passage of the Telecommunications Act of 1996. Findings were released today by the Competitive Broadband Coalition at ALTS ’99, the Annual Convention and Trade Exposition of the Association for Local Telecommunications Services (ALTS).

The study explores broadband alternatives nationwide with particular focus on rural areas. Key findings include:

n New entrants and small local telephone companies are driving the deployment of broadband services.

n The availability of broadband services in rural areas is more widespread than previously believed.

Competition, not regulatory quid pro quo, is driving the acceleration of Regional Bell Operating Companies’ (RBOC) and GTE’s broadband deployment, according to the findings. The study points to service availability data which conclusively demonstrates that RBOC deployment has in most cases been triggered by prior broadband initiatives from cable television operators via cable modem services, and competitive local exchange carriers (CLECs) deploying DSL and wireless technologies.

“The notion that there is some sort of ‘digital divide’ is a fiction being perpetrated by the RBOCs as the centerpiece of a public relations campaign aimed at reversing three decades of competitive U.S. telecom policy and extending these monopolies’ historic dominance of local telephone services into adjacent long distance and Internet services,” according to the study.

In attempting to create the impression that they represent the best chance of broadband deployment to rural areas, the RBOCs conveniently ignore two extremely important facts:

n Broadband services have been finding their way into rural communities without the supposed critical involvement and investment by RBOCs and GTE, and without the requirement to modify national telecommunications policies and goals to appease their demands.

n The RBOCs, in fact, have no history of commitment to serving rural areas, and in recent years, have been working diligently to offload their serving areas in many of these communities.

As evidence of these companies’ reluctance to do business in rural communities, the study points to a spate of divestitures of small rural exchanges by US West and GTE over the past several years.

On the other hand, the study says there is active provisioning of broadband backbone facilities in rural communities by a number of entities including member companies of the Rural Telecommunications Group (RTG), a coalition of wireless rural service providers, and the National Telephone Cooperative Association (NTCA), which represents rural wireline carriers.

“The study and the presence of facilities-based CLECs throughout the United States proves beyond a doubt that competition is bringing broadband services to rural areas as well as non-rural areas. Congress got it right—competition, not an industrial policy favoring monopolies, will deliver broadband to America,” said John D Windhausen, Jr., ALTS President.

“The findings demonstrate that competition must be allowed to take its course,” said Barbara Dooley, President of the Commercial Internet Exchange. “Otherwise, we risk hampering the development and widespread use of advanced communications services, including the Internet.”

“It's competition and new communications companies – such as McLeod USA, Frontier and Northpoint Communications-- that are the real forces behind the delivery of broadband services to all Americans -- whether they live in rural Minnesota or Montana,” said CompTel President, H. Russell Frisby, Jr. “The RBOCs and GTE have been playing fast and loose with the facts about broadband services. This study debunks some of those favored myths and gives a clearer picture of actual broadband deployment across the country.”

“Rural communities have not been left behind in realizing the benefits of competition in those telecommunications sectors, such as long distance, in which competition has been possible,” said Ernie Kelly, President of the Telecommunications Resellers Association. “If we follow this model, the deployment of broadband services in rural America will continue to be spurred by competitive policies in the same fashion.”

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The Competitive Broadband Coalition members include the Association of Communications Enterprises (ASCENT), the Association for Local Telecommunications Services (ALTS), AT&T, the Commercial Internet eXchange Association (CIX), CompTel (Competitive Telecommunications Association), Cable & Wireless, Information Technology Association of America (ITAA), Montana Telecommunications Association, Personal Communications Industry Association (PCIA), Sprint, Touch America and WorldCom. More information can be found at http://www.competitivebroadband.org/1041/home.jsp