Bringing broadband to rural America

Correction: A previous version misspelled Anna Read, who works for Pew Charitable Trusts.

(NewsNation) — In a state known for wide-open prairies meeting the barren badlands, even the most distant North Dakota farmhouse has high-speed internet. That’s thanks to a network of fiber optic cable that crisscrosses the state, with more coverage for its citizens than most urban areas.

But that’s not the case for many in rural states.

An estimated 42 million U.S. residents do not have access to high-speed internet — an increasingly critical infrastructure that determines job and education opportunities, healthcare, food access and more.

That jumps to 89 million when including those who only have access to one internet service provider, according to a recent study by BroadbandNow. Another 33 million people only have access to dial-up or DSL providers. The estimated cost to close the gap is $40 billion, according to the Federal Communications Commission (FCC).

The biggest challenges include the remote and difficult terrain that makes installation difficult, and rural telephone companies often charge exuberant amounts due to lack of competition — if they decide it even makes business sense to install, Tom Wheeler wrote for the Brookings Institution.

“It’s a chicken and egg problem, where if the city or the county isn’t making those investments, the firms don’t necessarily want to locate there,” said North Dakota State University economics professor Thomas Krumel. “Rural communities that are persistently poor are less resilient to external shocks — and in large part because they don’t have as much access to things like broadband.”

Yet an increasing amount of research shows expanding broadband to the most remote areas of the country has the potential to save billions long term.

‘The nation’s best internet access’

When the large telephone company US West began to consider divesting from low-population areas throughout the upper Midwest, many in North Dakota worried it would mean its rural residents would get left behind.

A group of small cooperatives and local providers came up with an unusual solution: Work together to buy out the US West’s rural exchanges — an acquisition that laid the groundwork for each company to share the cost burden of building new fiber networks.

“They didn’t intend to go out of business,” Bill Patrie told researchers from the Institute for Local Self-Reliance. “They intended to find a new way of doing business.”

The process wasn’t easy. The coalition not only had to negotiate with US West, they had to negotiate among themselves and convince local regulators to let the sale go through — work that stretched throughout most of the 1990s.

“The magic of this whole thing is those 15 different companies with 15 general managers [and] probably 11 different attorneys were able to cooperate and enter one bid,” Patrie said.

Without that level of cooperation, it may not be possible nor cost-effective for small businesses to completely replicate North Dakota’s success. Yet opportunity remains in the rural vacuums left by large telephone companies, and federal subsidies may make them more feasible.

Today, North Dakota far and away has the most fiber coverage in the country, resulting in the best internet coverage of any state.

Researchers found this approach was more beneficial to residents, because “local providers are usually more responsive to a community’s needs than out-of-state companies because their customers are their neighbors, not just spreadsheet inputs.”

Funding fiber

Fiber tends to be the gold standard because it provides the fastest internet speeds, has a long life and can be updated as technology improves. A fiber network can also be used to increase the speed of other common technology in remote areas, like a fixed wireless network.

“Fiber is really kind of a core component of any of these technology solutions that we’re talking about at this point,” said Anna Read, a senior officer with Pew Charitable Trusts’ Broadband Access Initiative.

Yet a jumble of state and federal regulations can limit who offers fiber connectivity in some places.

Experts say allowing newer electrical companies to repurpose the fiber infrastructure used to manage their electrical grids could reach an estimated 60% more unserved households — and save an estimated $8 to $15 billion.

For decades, the biggest challenge has been funding, Read said. This is particularly true of the difficulty connecting the “last mile” or “middle mile” of a network.

President Joe Biden’s Infrastructure Bill, passed in 2021, provides $65 billion to expand broadband to the 10% of the U.S. without access. Critical to that legislation, Read said, is that states will have the ability to prioritize projects based on their communities’ needs.