- Partnerships like the Rural Digital Opportunity Fund aim to bridge the digital divide in the US.
- But there are many challenges, like the cost of internet services for residents and digital literacy.
- Gaining access to utility poles and navigating local rules are additional hurdles.
- This article is part of the "Financing a Sustainable Future" series exploring how companies take steps to set and fund sustainable goals.
About a quarter of Americans living in rural areas lack broadband internet access, the FCC says. But public-private partnerships between governments and internet service providers, like the Rural Digital Opportunity Fund (RDOF), are helping to bridge the digital divide, or the gap that exists between people with access to the internet and those without.
Launched in 2020, RDOF is an FCC program that will make $20.4 billion available from the agency's Universal Service Fund over the next decade to finance broadband networks in rural areas. So far, more than $5 billion has been deployed to private utility and cable companies. To access funding, organizations submit a proposal for funding via a reverse auction. The agency greenlit another $200 million for the partnership this month.
Charter Communications, a Stamford, Connecticut-based broadband connectivity and cable operator known for its Spectrum brand, received $1.2 billion from the RDOF to install fiber and cable projects in 24 states. The company, which holds a $77 billion market capitalization as of this writing, has been working on broadband expansion in rural areas for several years. It has also committed an additional $3.8 billion from private capital expenditures to the projects.
Through its RDOF commitments, Charter will add more than 100,000 miles of new network infrastructure in underserved areas over the next five years and connect more than one million homes and businesses. Work is already underway on these projects, said Catherine Bohigian, the company's executive vice president of government affairs.
"We're building as fast as we can to get unserved families connected as quickly as possible, but even though providers like us are responsible for the actual internet connections and service, it takes a village to build and deliver internet service, especially in rural areas," she told Insider, adding that Charter coordinates with local governments, utility pole owners, and highway regulators for each project.
Here's a look at how public-private partnerships focused on broadband connectivity work, and the biggest wins and shortcomings that come with pairing utility companies with local governments.
Cable companies gain new customers while communities get connected
Rural communities often lack the knowledge and resources to expand broadband connectivity in their areas and become their own internet service providers, or ISPs. That's where public-private partnerships come in. Communities "don't have to develop the expertise from scratch," Christopher Ali, an associate professor of media studies at the University of Virginia and author of "Farm Fresh Broadband," told Insider.
Rural communities benefit by getting businesses and residents connected, but they still have to pay for internet service — though the FCC and some ISPs offer programs for low-income households. Cable and utility companies, meanwhile, benefit by gaining customers and growing their networks, Ali said, and local tax dollars and funding from programs like RDOF make it feasible for them to build the infrastructure.
"We need to be empowering communities and counties to be able to know their own broadband needs so they can approach a provider, rather than the other way around," Ali said.
Ensuring that broadband reaches the communities that need it the most
Still, RDOF has been criticized for not going far enough to reach the communities that need broadband the most. And, despite receiving RDOF money, some areas are so remote and rural that broadband providers may be unwilling and not incentivized to build broadband infrastructure there, with few people to pay for monthly internet service.
Closing the digital divide also depends on more than expanding broadband networks. Bohigian said it also requires addressing adoption issues, like the cost of internet services, access to computers, and digital literacy.
Charter strives to fill these gaps by participating in the FCC's Emergency Broadband Benefit program and Affordable Connectivity Program, aimed at helping households afford the internet, and educating people about these benefits. The company also offers low-cost broadband service for certain households.
Utility pole access is also another hurdle providers face
Private ISPs working in rural areas also have to contend with access to utility poles, which requires working with the local telephone, electric, or cable companies that own the poles. Other issues include navigating local rules and dealing with poles that are outdated and can't accommodate new network infrastructure, Bohigian said.
Charter completed projects in El Paso County, Texas, Richland County, South Carolina, and Evangeline Parish, Louisiana, ahead of schedule because pole owners helped streamline the projects, Bohigian added. That's not always the case, though. Sometimes, it can take months for the company to get permits to access poles, which delays projects.
"Faster access to poles can shave months — or even years — off of the time to deploy and it is essential to getting 100% of the country online," she said.