13pgs, Sufficient access to and utilization of broadband is an ongoing concern for rural economic development. Using a rural region in Northern New York (USA), we consider the investment and operational costs of a broadband cooperative and determine service prices for which it is financially viable. Service prices need to increase 75%–131%, depending on grant restrictions, relative to existing market prices for a new broadband cooperative to become financially feasible. Put differently, the cooperative would not cash flow at market prices unless there was at least 14 potential subscribers per mile at a 62% take rate. For a cooperative, the grant restriction that providers offer a minimum level of speed at a maximum price results in a high level of subsidization by high-speed to low-speed members to support the business. Given grant funding and member equity investments, financial infeasibility has little to do with construction costs, than with annual operational and maintenance costs required to sustain the system long term. More reasonable feasibility scenarios occur for existing utility cooperatives expanding services into broadband, particularly areas with a high proportion of high-speed, year-round users and strong take rates. Consideration of public benefits of broadband arguably needs to be added to the equation, particularly surrounding access to healthcare and educational purposes, and as a prerequisite to supporting taxpayer-funded public-private partnerships to expand broadband services. Policy levers to eliminate or subsidize property taxes and pole rental costs reduce cash flow prices considerably; however, feasibility is highly sensitive to assumed take rates.
2 pages., Via online summary of an online article dated December 10, 2018, from PCMag.com., "This represents an important step towards a more inclusive global information society," International Telecommunication Union (ITU) Secretary General Houlin Zhao said in a statement. However, he added that more needs to be done to connect the rest of the world to internet.
Agricultural Communications Documentation Center, Funk Library, University of Illinois Document Number: C25447
Notes:
Pages 312-336 in Maximo Torero and Joachim von Braun (eds.), Information and communication technologies for development and poverty reduction: the potential of telecommunications. Johns Hopkins University Press, Baltimore, Maryland. 362 pages.
