Wednesday, February 6, 2019

Will Bill Bring Broadband to the Boondocks?

Will rural Mississippi finally get some of that new-fangled broadband service?   The pastoral life has its advantages but also one serious drawback: slow internet service when it is available at all. The legislature passed a bill last week that authorizes the electric co-ops to offer broadband service to their members.  Supporters likened it to the 1930's crusade to electrify rural Mississippi. The bill sped through the House and Senate with little fuss.  After all, who wants to be against baseball, hot dogs, apple pie, and rural broadband?

HB #366 allows electrical cooperatives to provide broadband internet service to their customers.  State law prohibited the co-ops from providing such service.  The new law becomes effective upon the Governor's signature. Copy of bill. Electric co-ops serve 85% of the state and provide power to "1.8 million Mississippians." 

Mississippi ranks 49 in broadband deployment (ahead of Montana) as only 70% of the state enjoys broadband coverage with an average speed of 25 Mbps - 10 Mbps lower than the national average.  To say there is a demand for broadband coverage in Mississippi is an understatement.*

The highlights of the bill are:

*Co-ops can establish broadband affiliates.

*Electric energy revenue can't be used to subsidize the affiliate.  However, the co-op may invest, lend money at a fair market rate, and guarantee loans for the affiliate.

*The co-op must conduct a feasibility study and place it upon the minutes of its board.  The plan must provide service to the "entire certificated area."

* The co-op must charge the same pole attachment fees to the all customers, including the affiliate (More on pole attachment fees later).

* Electrical service can't be disconnected if the customer fails to pay for the broadband service.


Hmmm..... guarantee loans.  Where have we heard that one before? Did the Commissioner and some legislators discuss it while on a Natchez Trace road trip?  What happens if the affiliate goes belly-up? What if the affiliate is going to miss loan payments?  Will the broadband fail whale sink the co-op?  Of course, such concerns are passe when everyone wants to do the right thing.

The telcoms tried to slow down this train but to no avail.  The Blue C as well as Big Red watched from the sidelines.  AT&T had a small conniption until it was forced to sit down and shut up.  The remaining ISP's thus fought the Broadbanders alone but became rural roadkill for the co-ops.

The media focused on who beat who instead of digging into the dirty little secret of rural broadband coverage in Mississippi: the pole attachment fees the co-ops charge the internet service providers (KF: Looking at you: Bobby, Jeff, and Geoff.). The co-ops profit mightily off of these fees and are thus loathe to give up any portion of this revenue even if it means their members can't get broadband service.

It is much cheaper for companies such as AT&T and Charter to string fiber-optic cable from pole to pole instead of placing it into the ground, which can run $100,000 per mile.   Leasing pole space saves money and prevents the appearance of clutter as no one wants to see four poles in an area where one would suffice.

The co-ops in Mississippi have used the pole attachment fees as an excuse to gouge the internet service providers.  Regulated utilities such as Entergy and Mississippi Power charge an average pole attachment fee of $4 per pole while the unregulated co-ops charge $17 per pole.  The FCC set a limit on such fees but Mississippi exempted itself from the FCC regulations.

Lisa Shoemaker, Executive Director of the Mississippi Cable Telecommunications Association, told the Senate Energy Committee that  ISP's pay approximately a million dollars a year to private, regulated utility companies in pole attachment fees while forking over $4 million per year to the unregulated co-ops for roughly the same amount of poles.

The substantially higher pole attachment fees prevent the ISP's from providing broadband service to more areas in Mississippi.  A higher-cost market means a smaller market if the profit shrinks or is non-existent. However, the co-ops successfully fought any attempt at the capitol to cut the pole attachment fees.   A cash cow is a sacred cow and pole attachment fees are the Holy of Holies for the co-ops.

However, Northern District Public Service Commissioner Brandon Presley disputed the telcom's complaints about the pole attachment fees.  He said the claim that there was a large difference in the fees is "an utter complete falsehood and said the telcoms have not filed complaints about the fees with the PSC.  He said the bill states the co-ops must charge the same fee to its broadband affiliate as it does other ISP's.

Make no mistake, it was Commissioner Presley who charged up the hill for this bill as he want full Vader with his broadband light-saber. . Few legislators argued against the bill.  The bill passed the Senate unanimously while only three Representatives voted nay in the House. 



The Commissioner said he got the idea for bringing high-speed internet service to rural Mississippi after he studied a similar project rolled out by the Tombigbee Electric Cooperative in Alabama.  he said rural constituents were constantly asking him when they could get broadband service.  He said Tombigbee, a 9,500 member co-op, voted in 2017 to provide broadband service.  He said Phase I was "up and running" within eight months.  He said "If they can do it there, we can do it here."

Mr. Presley said Meriwether Lewis Electric Cooperative in Tennessee offers unlimited broadband service for $49.95 per month.   The Commissioner claimed there are 107 co-ops providing broadband service across the nation and that Mississippi co-ops can provide the same service. 



They will probably follow the model ML Connect posted on its website:

Our first phase includes in and around the cities within each of the counties MLEC serves. First up are Waverly, Hohenwald and Centerville. After that, we'll be building out in the other cities in this order to complete Phase I in 2019: New Johnsonville, Erin, Tennessee Ridge, McEwen, Linden and Lobelville. The first MLConnect phase for broadband construction will help build the entire project’s infrastructure. After that, areas where members have logged interest will help guide the projects’ progress. Click “I’m Interested” on www.mlconnect.com to log your interest with no obligation to buy.
Building an internet infrastructure is obviously not cheap.  It will not be surprising if only a handful of rural areas actually have high-speed internet.  Several larger Mississippi cities are served by electric co-ops.  Those co-ops will compete with the Verizons and AT&T's with government-favored access to capital to building up those networks.  Co-ops serve Hattiesburg, Meridian, Tupelo, and other cities that already enjoy broadband service.  Are these co-ops going to provide rural broadband service or are they just going to compete in cities that already have high-speed internet service?

Questions and numbers were lost in the debate as the leadership of both chambers made it clear it just wanted to git 'er done, actual thinking be damned.  No one actually provided any studies showing the costs of bringing high-speed internet to rural Mississippi or if it was technically possible.  Mississippi is a poor state? How many people living in rural areas can afford to pay $50 to $100 per month for the service to make it somewhat feasible for the co-ops to deploy? Indeed, the Solons were cautioning on Facebook that it would take a few years to roll out the service and not everyone would be served.  However,  they piped down and voted for it anyway as  no one wanted to be seen as hatin' on the good country folk of this state.

Only time will tell if rural Mississippi will enter the 21st century or if the politicians promised much while once again delivering little.


*Southeast Broadband Coverage

State, Coverage, Speed, Ranking
Mississippi: 70%, 25 Mbps (49)
Arkansas: 77%, 25 Mbps (48)
Alabama: 81%, 34 Mbps (41)
Louisiana: 85%, 35 Mbps (36)
South Carolina: 88%, 39% (28)
Tennessee: 90%, 37 Mbps, (24)
Virginia: 90%, 49 Mbps, (22)
Georgia: 91%, 39 Mbps (20)
North Carolina: 93%, 42 Mbps (15)
Florida: 95%, 41 Mbps, (10)

Source: Broadbandnow.com

Kingfish note: Posted below is the written statement MCTA provided to the Senate Energy Committee.  Anything similar from the EPA's will be posted as well if submitted.









25 comments:

Anonymous said...

When it goes to shit Presley owns it.

Anonymous said...

Criticize all you want, but it's a fact that nothing will get done if something isn't tried. People love to fuss about MS being so far behind the rest of the country, yet any attempt to improve things is met with resistance.

Cynical Sam said...

Who is "Bill?"

If AOL dial-up was good enough for grandpa, it is good enough for the rest of you country bumpkins.

Anonymous said...

@ Cynical Sam, or February 6, 2019 at 12:31 PM if you will:

"Bill" refers to House Bill #366.

If you had an ounce of intelligence, you would understand that is what the article is all about.

Country Bumpkins indeed!

Anonymous said...

I don't believe it will fail. I believe it will be a huge boon to many and allow for commerce we have not even envisioned. Access to good internet services is/was a life-changing event for me.

Cynical Sam said...

@12:51 PM - You took it hook, line, sinker.

Anonymous said...

5G Will make this irrelevant. Most people already enjoy Internet access throughout the state using LTE. I doubt the numbers accurately reflect that. The future is not some modem plugged up to the wall.

StarRider said...

I live WAY out in the boonies, I mean like if a car goes down my road I not only know them but most likely their family too. Only place I have any desire to live, but...8MBS DSL is the best choice here. And actually, for what we use internet for, it works very well, surfing and light streaming. Before that it was HughesNet, which was more expensive, slower, and had data limits, which if you exceeded you went back to dial-up speed. $50 300MBS service, I will be all over it and smile when I pay the bill every month. Now we can cross our fingers and wait to see how big a Charlie Foxtrot this turns into, I will be hopeful but skeptical.

Anonymous said...

There's no reason they should have been prohibited from offering these services in the first place. Deregulate the whole thing and watch energy prices come down.

Anonymous said...

Why does the dumb a## state legislature have anything to do with this? Let's move forward and give the legislature, governor, and other incompetent Mississippi leaders their false credit for a no brain decision. I can just hear them at Tico's explaining how they "Brought" these services into the state after overcoming many hurdles The only way we are going to move economically from the 50th state ranking is to make Puerto Rico a state.

Anonymous said...

Giving a monopoly more power is never a good move. Have you seen the "Uniforms" these guys wear? Cinch jeans and shirts. Google those prices!

Anonymous said...

5G does not make this irrelevant. Mobile carriers cap you data usage, and then charge out the wazoo. Streaming content eats that up- and its the future for at home education, etc. not just entertainment. My lake house is limited with its streaming (Hughes) my home with XFinity is not- at least for now.

Bandwith requirements for basic services will continue to grow- as will the charges.

Anonymous said...

Gigabit speeds with no monthly cap is a good deal in the city for $80. If this works I think I will need to seriously consider moving my family away from the plebian dreck of Pearl and out to the land owning gentry of Pisgah or maybe even Puckett.

Anonymous said...

There's a reason the telecom lobbyists who own these politicians allowed this to go through. They know there is 0 chance this gets done. The numbers just don't add up. If I lived in the sticks, I'd be much more interested in seeing Elon Musk get Starlink running.

Anonymous said...

And on a lighter note, Ridgeland PD was running a road block in front of Wright’s mill at 8pm. They must be hurting for revenue. I haven’t then out this early in a long long time.

Anonymous said...

@8:27 Elon Musk doesn't have the best track record of consistent success. He thrives with fat gubmit subsidies, but whenever the federal funds run out, his pipe dreams dry up.

He does dream beautiful.

Anonymous said...

Pisgah, Pearl and Puckett. Man! Whatta house-hunter's Utopia.

Anonymous said...

One way to tell which coops stand any chance of offering this service is look at each coops "average number of customers per mile of line". It was all about preserving non-electric sales revenue enhancement from the git go. ie: Sacred cash cow is right. The coops electric sales growth is stagnant. They are not growing. The little hermit kingdom fiefdoms have to look for additional ways to prop up revenues to protect their big ass salaries, 401Ks and pension plans. All coop GM's are millionaires as well as many of their staff not to mention the G&T wholesale power rapists in Hattiesburg and the political check cutting lobby on Highland colony.

Anonymous said...

Some good comments here -- and some not so good. Who says that it's a foregone conclusion that the EPAs have to string new fiber optic line everywhere and to every home/business? That seems to be the going-in conclusion that some EPAs have -- at least for Tombigbee (read their December minutes), North Central (watch their latest podcast), or Commissioner Presley himself. And who says that a symmetric gigabit of bandwidth to every customer is needed -- it clearly is not when a dependable lower-cost connection to 20 something megabits/second both ways with a huge data cap will do just about everything an average family could need. Gamers and businesses -- let them pay a larger price for no-cap/gigabit service.

Their are hybrid technical alternatives which have and are emerging that may make better use of the EPA's biggest asset -- existing electrical grid lines. Is a new all fiber network to every home/business the best solution -- sure, for the end user. But not for the folks who have to fund its installation, maintenance, and operation. And remember -- those "free USDA/federal grants" get paid for by us, the folks who must pay income/business taxes. Try making a business case for a new all fiber optic network for a $6M per year EPA like Alcorn -- that dog will likely not hunt.

The legislature (and the many supporters of HB366) did a very good thing in my opinion. The EPAs need to take a quick breath, and retain experts who can help them quickly & completely evaluate technical/cost alternatives without any future commitment to getting the installation or operations work for the network...

Anonymous said...

So, what exactly are you bitching about, 7:34? The CEOs of most corporations are millionaires. The CEO of Entergy in each state is a millionaire. Most lawyers are millionaires after the age of 50. What are you pissed about? You think coop executives ought to be making $45k?

Anonymous said...

Someone should look into the landowner's ROW easements that these coops have, I guess, supposedly somewhere? Are they legally filed, "of record" in a courthouse? Doesn't the landowner deserve some of the revenue from these pole attachment fees? Are these easements a metes and bounds description? Would you grant an easement or lease out your property in perpetuity for nothing where the lessee discovered gold? These landowners were never even paid for granting ROW easements.

Anonymous said...

8:39,

Respectfully, how about easements for other local utilities like buried fiber, copper, water, sewer, gas, etc.? I suspect the revenue from them isn't paid to the landowner either, but general benefits do accrue to the public, right? On a larger scale, the regional power providers (like TVA) don't pay any of their revenue from transmission towers/lines that run thru ROW easements on private property, do they?

Anonymous said...

Okay then, where is my "ANNUAL" landowner power line ROW attachment fee? pater familius virtue

Anonymous said...

Don't farmers ranchers hunters have to pay annual leases to property owners for using their lands? Pay and PAY BIG $$$ You fkn coop leaches need to pay up? "Its not personal, it's strictly business.." after all.

Anonymous said...

What landowner these days gives up any (easement/use) right to their property without being compensated????

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