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Bills Aim to Fill Broadband Gap

At the Maine Public Utilities Commission, Phil Lindley, an analyst in the finance division, receives about one phone call a week from someone asking when broadband service will become available.

By Elisa Batista Wired.com

More than half of Maine’s population receives home Internet service through a dialup connection, Lindley said. But unless they get broadband through their cable providers, most Maine residents can’t receive high-speed access. Many residents of the state live too far away from the telephone switches, making it impossible for the phone company to install DSL.

"Everywhere in Maine is a rural area," Lindley said. "The town I live in has a population of 2,500. I get my cable service through Adelphia and I get broadband from them. I think I am too far away from a telephone switch to get DSL. That’s just a technical limitation."

It is a "technical limitation," though, that has left many people in the cold in terms of broadband.

Legislators like Maine’s Republican Sen. Olympia Snowe long have said the lack of broadband access in rural communities hampers business for companies who can’t get high-speed connections for employees. It also has created "victims of a digital divide that continues to grow," Snowe said.

In response to concerns over a broadband digital divide, the Senate passed a jobs and growth package last week that included an amendment — co-sponsored by Snowe and others — that would allow communications service providers to receive a tax deduction for installing broadband equipment in rural and underserved urban areas.

As another incentive for companies to roll out broadband in rural areas, Snowe and Sen. John Rockefeller (D-W.Va) are holding a hearing this Thursday on a bill that proposes to give communications service providers tax credits of between 10 percent and 20 percent to roll out broadband systems in underserved regions.

"This is another piece of the puzzle to streamline broadband," said Grant Seiffert, vice president of global policy for the Telecommunications Industry Association, which supports tax breaks as incentives for broadband deployment in underserved areas.

As for market initiatives, the Federal Communications Commission is mulling over proposals by utility companies to offer broadband service through power lines. Even though the telecommunications industry admits the technology, along with cable and satellite, would compete with DSL, it is supportive of the initiative because it would serve as an incentive for the telecom industry to serve rural customers.

"Our goal is to create an incentive" for companies to roll out broadband in underserved areas, Seiffert said. "It’s a business decision. Broadband is expensive (to roll out). But we’re supporting industries that will help our customers deploy broadband."

Seiffert said his industry was reluctant for years to serve rural areas because they were forced under federal law to lease their lines to competitors at a discounted rate. He is confident that consumers, in general, will see more DSL deployment now that the FCC has overturned that mandate.

While industry experts agree that rural broadband deployment has been hampered by the cost of rolling out networks to sparsely populated areas, others are not sure the FCC decision will spur DSL providers to offer better service to customers.

Lindley said Verizon, for example, has an 85 percent stake in the DSL market in Maine while 22 smaller companies control the other 15 percent of the market.

Lindley said he was aware of at least one smaller ISP in Maine that was providing broadband access by leasing underlying facilities that belong to Verizon. The FCC decision, he said, "could have an impact on that."

Meanwhile, others are skeptical that, even following the FCC’s decision, large telecom firms will be willing to shell out the sums needed to bring high-speed access to rural communities.

"To lay out millions of dollars in fibers to serve only 30 people is prohibitively expensive for these companies," said Mark Gedris, spokesman for the United Telecom Council.

http://wired.com/news/business/0,1367,58908,00.html

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