NTCA~

NATIOr-;AL TllECOMMU ICATIONS COOrERATIVE ASSOCIATION

The Voice of Rural Telecommunications

www.ntco.org

May 3, 2010

Ms. Marlene H. Dortch, Secretary

Federal Communications Commission
445 12th Street, SW, TW-A325
Washington, D.C. 20554

Ex Parte Notice:

In the Matter of a National Broadband Plan for Our Future, GN Docket No. 09-51

Dear Ms. Dortch:

Today, May 3, 2010, NTCA, OPASTCO and WTA sent the attached letters to Congress to warn about the
low threshold speed of 4 Mbps set by the National Broadband Plan (NBP). Our associations and our
member companies urge the FCC to redirect the course of the NBP to ensure adequate cost recovery for
rural broadband providers so that all consumers and businesses residing in the nation’s high-cost, rural
communities receive the benefits of comparable and affordable broadband service as required by law.

Pursuant to Section 1.1206 of the Commission’s rules, a copy of this letter and letters to Congress are being
filed via ECFS with your office. If you have any questions, please do not hesitate to contact me at (703)
351-2016.

Sincerely,

/s/ Daniel Mitchell

Daniel Mitchell
Vice President
Legal and Industry
DM:rhb

cc: FCC Chairman Julius Genachowski

Commissioner Michael Copps
Commissioner Robert McDowell
Commissioner Mignon Clyburn
Commissioner Meredith Attwell Baker

NATIONAL ELECOMMUNICATIONS COOPERATM ASSOCIATIO

4121 Wilson Boulevard· Tenth Floor· Arlington, Virginia 22203
PhoneI703-351-2000· FaxI703-351-2001 • www.ntca.org
NTCAW
NArJONAl HLECOMMUNICATIONI COOPERATIVE ASSOCIATION
The Voice ofRural Telecommunications
W EST ERN
TELECOMMUNICA TlONS
ALLIANCE
www.ntca.arg OPASTCO

May 3, 2010

The FCC’s National Broadband Plan Disadvantages Rural Consumers, Creates a New
Urban/Rural Digital Divide, and Harms Future Rural Economic Development

Dear Representative:

On April 23, 2010, the Federal Communications Commission (FCC) released a Notice of Inquiry
(NOI) on a broadband cost model along with a Notice of Proposed Rulemaking (NPRM) on
proposed Universal Service Fund (USF) rules in regard to the National Broadband Plan (NBP).
The NBP has set a goal of 4 Mbps for universal broadband availability to all Americans by 2020,
while pursuing download speeds of 100 Mbps (100 squared plan) for 100 million households.
This approach guarantees that consumers, businesses and communities in high-cost, rural areas
throughout the United States will receive severely inadequate broadband service, while more
densely populated, lower-cost urban areas, which will be part of the 100 squared plan, will enjoy
the benefits of speeds 25 times faster. These proposed rules, if adopted, would most certainly
create a new broadband urban/rural digital divide.

Urban, metropolitan, and suburban areas across the United States have the population bases and
economic foundations to support 100 Mbps broadband availability well before the year 2020.
Conversely, many rural communities neither have the populations nor independent financial
means to support 4 Mbps, let alone a comparable 100 Mbps broadband service by 2020, without
a strong cost-recovery system. Without broadband speeds greater than 4 Mbps, expanded
opportunities for medical services such as telemedicine and electronic X-ray sharing; distance
learning; home businesses; and high-definition programming will not be available due to
inadequate bandwidth. The NBP’s broadband service goals would also violate the comparability
and affordability standards contained in the Communications Act, and would greatly endanger
investment, jobs and economic development throughout rural America.

The importance of higher speed broadband access to rural economies was recently confirmed in
an April 2010 report by the President’s Council of Economic Advisers, titled “Strengthening the
Rural Economy – The Current State of Rural America.” The report said, “Broadband service
helps rural businesses find markets that otherwise might be unavailable to them, facilitates online
ordering and billing, and integrates the rural economy with the rest of the country (and the
world) more effectively than is possible over slow-speed Internet connections.”

Since the early 20th century, many of the industry’s largest telecom providers chose not to invest
in facilities to provide basic telephone service in the geographic areas of the United States that
are the most economically challenging to serve. These areas consist of the most rural, insular,
and sparsely populated areas of the nation, such as the Northern Plains, Appalachian and Rocky
Mountains, Southwestern Deserts, Central and Mid-Western farmlands, Native American
reservations and the frozen tundra of Alaska.
Conversely, NTCA, OPASTCO and WTA member companies have invested in and built the
networks that serve these rural communities that provide food, energy and raw materials to urban
America and the world. These companies and their ability to continue to provide comparable
telecommunications services to rural Americans are vital to our nation’s economic development,
national security and public health and safety. Their investments have been possible due to a
time-tested cost-recovery structure consisting of rate-of-return regulation, National Exchange
Carrier Association pooling, intercarrier compensation and USF support. It has been through
these mechanisms that rural consumers’ access to services at prices that are affordable and
comparable to services and prices received by urban consumers has been achieved, as required
by the Communications Act. The FCC should now be looking to recreate this success story and
not undermine and otherwise ignore what has worked to reach these goals.

Our associations and our member companies urge Congress to insist that the FCC redirect the
course of its NBP to ensure adequate cost recovery for rural broadband providers so that all
consumers and businesses residing in the nation’s high-cost, rural communities receive the
benefits of comparable and affordable broadband service as required by law.

Thank you for your consideration and attention to this critical issue confronting our great nation.

Sincerely,

/s/ Michael Brunner /s/ John Rose /s/ Kelly Worthington

Michael Brunner John Rose Kelly Worthington
Chief Executive Officer President Executive Vice President
NTCA OPASTCO WTA

cc: FCC Chairman Julius Genachowski

Commissioner Michael Copps
Commissioner Robert McDowell
Commissioner Mignon Clyburn
Commissioner Meredith Attwell Baker
NTCAW
NArJONAl HLECOMMUNICATIONI COOPERATIVE ASSOCIATION
The Voice ofRural Telecommunications
W EST ERN
TELECOMMUNICA TlONS
ALLIANCE
www.ntca.arg OPASTCO

May 3, 2010

The FCC’s National Broadband Plan Disadvantages Rural Consumers, Creates a New
Urban/Rural Digital Divide, and Harms Future Rural Economic Development

Dear Senator:

On April 23, 2010, the Federal Communications Commission (FCC) released a Notice of Inquiry
(NOI) on a broadband cost model along with a Notice of Proposed Rulemaking (NPRM) on
proposed Universal Service Fund (USF) rules in regard to the National Broadband Plan (NBP).
The NBP has set a goal of 4 Mbps for universal broadband availability to all Americans by 2020,
while pursuing download speeds of 100 Mbps (100 squared plan) for 100 million households.
This approach guarantees that consumers, businesses and communities in high-cost, rural areas
throughout the United States will receive severely inadequate broadband service, while more
densely populated, lower-cost urban areas, which will be part of the 100 squared plan, will enjoy
the benefits of speeds 25 times faster. These proposed rules, if adopted, would most certainly
create a new broadband urban/rural digital divide.

Urban, metropolitan, and suburban areas across the United States have the population bases and
economic foundations to support 100 Mbps broadband availability well before the year 2020.
Conversely, many rural communities neither have the populations nor independent financial
means to support 4 Mbps, let alone a comparable 100 Mbps broadband service by 2020, without
a strong cost-recovery system. Without broadband speeds greater than 4 Mbps, expanded
opportunities for medical services such as telemedicine and electronic X-ray sharing; distance
learning; home businesses; and high-definition programming will not be available due to
inadequate bandwidth. The NBP’s broadband service goals would also violate the comparability
and affordability standards contained in the Communications Act, and would greatly endanger
investment, jobs and economic development throughout rural America.

The importance of higher speed broadband access to rural economies was recently confirmed in
an April 2010 report by the President’s Council of Economic Advisers, titled “Strengthening the
Rural Economy – The Current State of Rural America.” The report said, “Broadband service
helps rural businesses find markets that otherwise might be unavailable to them, facilitates online
ordering and billing, and integrates the rural economy with the rest of the country (and the
world) more effectively than is possible over slow-speed Internet connections.”

Since the early 20th century, many of the industry’s largest telecom providers chose not to invest
in facilities to provide basic telephone service in the geographic areas of the United States that
are the most economically challenging to serve. These areas consist of the most rural, insular,
and sparsely populated areas of the nation, such as the Northern Plains, Appalachian and Rocky
Mountains, Southwestern Deserts, Central and Mid-Western farmlands, Native American
reservations and the frozen tundra of Alaska.
Conversely, NTCA, OPASTCO and WTA member companies have invested in and built the
networks that serve these rural communities that provide food, energy and raw materials to urban
America and the world. These companies and their ability to continue to provide comparable
telecommunications services to rural Americans are vital to our nation’s economic development,
national security and public health and safety. Their investments have been possible due to a
time-tested cost-recovery structure consisting of rate-of-return regulation, National Exchange
Carrier Association pooling, intercarrier compensation and USF support. It has been through
these mechanisms that rural consumers’ access to services at prices that are affordable and
comparable to services and prices received by urban consumers has been achieved, as required
by the Communications Act. The FCC should now be looking to recreate this success story and
not undermine and otherwise ignore what has worked to reach these goals.

Our associations and our member companies urge Congress to insist that the FCC redirect the
course of its NBP to ensure adequate cost recovery for rural broadband providers so that all
consumers and businesses residing in the nation’s high-cost, rural communities receive the
benefits of comparable and affordable broadband service as required by law.

Thank you for your consideration and attention to this critical issue confronting our great nation.

Sincerely,

/s/ Michael Brunner /s/ John Rose /s/ Kelly Worthington

Michael Brunner John Rose Kelly Worthington
Chief Executive Officer President Executive Vice President
NTCA OPASTCO WTA

cc: FCC Chairman Julius Genachowski

Commissioner Michael Copps
Commissioner Robert McDowell
Commissioner Mignon Clyburn
Commissioner Meredith Attwell Baker