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Broadband Expansion, Prioritized by Texas Legislature, Presents Complex Problems

The Texas legislature has prioritized broadband expansion this session — an endeavor that to date has been the equivalent of trying to jam a square peg through a round hole.

Officials’ solution, so far, is to create a Broadband Expansion Office (BEO) to facilitate the effort by private companies to reach all Texans with at least a 25 megabits per second (Mbps) internet download speed and a 3 Mbps upload speed (25/3 Mbps). Proponents argue that an entity at the state level to coordinate the financial and logistical lift would provide a closer voice than the faraway dictates in Washington D.C.

The catch is that because Texas is the second-largest land area state with the second-largest population, the endeavor would be neither cheap nor straightforward.

With 2020 being the year “sequestration” gained a new political meaning as stay-at-home orders closed businesses, churches, and schools alike, the ability to dive into the worldwide web became imperative.

According to Connected Nation Texas, an organization that measures internet connectedness and advocates its expansion, over 516,000 are counted “unserved” by Federal Communications Commission (FCC) metrics. The majority of that total is in rural areas.

Previously, connectedness was tracked by census block, but that method is marred by imprecision. If one household in a given census block had 25/3 Mbps, then the entire unit was counted as “served.” It didn’t matter if others in the block lacked connection entirely.

In the last few years, reforms to that mapping strategy have gained steam and gesture toward a more precise mapping technique. Using strategies like geo-mapping have righted that ship.

But implementation’s other hurdles are significant.

Logistically, providing broadband service in the traditional way — laying fiber either in the ground or on already existing telecommunications infrastructure — would require traversing tens or hundreds of thousands of miles. Fiber is the chosen method for populated areas because it can deliver higher speeds to a denser population. Its cost-efficiency, or return on investment (ROI), is worth it for urban and suburban areas.

However, it is less optimal for less dense areas. Without enough potential customers to offset or surpass the costs incurred from building the infrastructure, service through fiber is not feasible without some sort of additional factor.

That method also requires substantial annual upkeep.

Financially, the costs of statewide broadband expansion are enormous. One estimate given to The Texan amounted to $45,000 to $80,000 per mile installation costs and $30,000 to $40,000 in annual upkeep per mile.

If approved by the legislature, the BEO will be tasked with divvying out state and federal grants to companies who’ve committed to service underserved areas.

One of the nation’s largest internet providers, AT&T, told The Texan in an emailed statement, “This legislation will create a new State Broadband Office, which will be empowered to create a State Broadband Plan – both of which we support and believe are key to ensuring connectivity for all Texans.”

“AT&T also supports the Legislature’s emphasis on broadband adoption and recognition that the benefits of high-speed broadband connectivity are only achieved if Texans with access to broadband services actually subscribe to the service.”

From 2017 to 2019, AT&T invested over $8 billion in wireless and wireline networks in Texas. The company currently has over 15 million miles of laid fiber in the state with plans for more expansion.

To reach the more rural communities, AT&T uses technology like fixed wireless internet — a method of broadcasting wireless from a central location to individual receivers. A download speed of 25 Mbps is typical for its use.

The nature of providing service to areas that present a best-case breakeven scenario, if not a financial loss entirely, means that providing the service is next to impossible for companies — even for those as big as AT&T.

Texas has bridged a similar gap before with its telecommunications industry. The state has a universal service mandate that every Texan have access to a telephonic connection. To accomplish this and fill the financial hole, the state created the Universal Service Fund (USF) financed by a small fee tacked onto every one of the state’s billions and trillions of telephone calls. The USF balance is then distributed to the cooperatives and other entities building and managing the telecommunication infrastructure.

While currently a point of contention between the telecom companies and the Public Utility Commission tasked with managing the USF, it is a model the state could opt for once in the thick of carrying out a universal service directive.

AT&T indicated its support for some sort of outside funding to those tasked with expanding coverage due to the balance sheet obstacle.

But the big conglomerates are not the only ones diving into the broadband expansion debate. ElektraFi — a company whose mission is to “Light up rural America with high quality, affordable, high speed internet access and deliver those services with a friendly, community focused approach” — has been operating a pilot market in southeast Texas.

Ryan Jenkins, CEO of ElektraFi, told The Texan that his company has been able to provide unlimited 50/10 Mbps to their roughly 2,000 household customers at a fraction of fiber’s cost. ElektraFi’s download speeds it can provide can go as 500 Mbps and with forthcoming technological upgrades, Jenkins expects that to climb to one gigabit per second.

With two more towers set for launch with ElektraFi service in the coming months, Jenkins expects that number to triple.

ElektraFi is a service provider that partners with co-ops, municipalities, and other entities that already have infrastructure and focuses on using 4G and 5G cellular networks rather than using pole-in-ground fixed methods. They lease space on already constructed infrastructure, like cell towers, which then serve as a broadcasting point to their wireless customers. If tower space doesn’t exist, then ElektraFi will build their own tower.

Construction of the tower and necessary equipment can cost between $80,000 and $150,000. But once operating, it has a service radius of about 10 miles.

Using this strategy, Jenkins said ElektraFi expects to expand to a nine-state region in the next five years.

“Our goal is to be the number one rural cell carrier in the nation. You’ve got the big three (AT&T, T-Mobile, and Verizon) who are focused on the metro markets, but our network allows us to come in and deliver high-quality broadband to these areas but also to provide mobile phone roaming for the major three,” Jenkins told The Texan.

About the need for broadband expansion, Jenkins said, “Rewind 100 years ago and if you had a library, you had access to knowledge that put you at an advantage, and this is the new library — and if you don’t have access to knowledge you’re going to get left behind.”

Jenkins and his entire team come from rural areas, providing them the same perspective of the consumers they’re pursuing.

ElektraFi’s target market is areas with roughly between 12,000 and 35,000 residents. Around 70 of Texas’ counties currently fit that bill. For areas even more sparse, Jenkins estimates technology like SpaceX subsidiary Starlink’s low Earth orbit satellite service could fill that gap well.

Currently in beta testing, Starlink promises speeds of 50 to 150 Mbps and latency speeds between 20 and 40 milliseconds (ms) — well below the 150ms industry benchmark.

SpaceX did not respond to the inquiry for this story.

Jenkins said the public policy conversation surrounding broadband expansion has focused disproportionately on the larger entities. “Smaller companies like mine are not really getting a seat at the table, partially because we’re busy fixing the problem and not talking about it — but the other side is we never got the invite,” he stated.

With no holds barred against the big three carriers, Jenkins continued, “They’re getting everyone excited about 5G, but often they only have 4G and sometimes they have no-Gs. There are huge parts of Texas that have zero bars, so if you think these publicly traded companies are going to suddenly start caring about these areas, you’ve got another thing coming.”

The tech industry is constantly evolving and so breakthroughs can materialize at any moment. Where a few years ago, these sparsely populated areas of Texas had little hope for quality internet connection, the light of opportunity may now be shining through the clouds.

The Texas legislature and other state officials have shown they’re gung-ho for broadband expansion.

But as with anything, execution is everything — and in a state with as many moving parts as Texas, the execution is not as simple as flipping a switch.

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