Rural Telecom Funding Model Must Change

Young man and woman remote studying

By Jeff Johnston

COVID-19 has wreaked havoc on all Americans but has clearly exposed the vulnerability of the underserved and unserved. For those who lack broadband access, the sense of urgency to bridge The Digital Divide is palpable.

COVID-19 and the associated stay-at-home orders exposed the vulnerability of those without broadband access. While rural operators went to great lengths to connect the underserved and unserved through the crisis, more must be done — especially as leading infectious disease experts say we could be dealing with COVID-19 impacts for a while.

Rural telecommunication operators are taking on business and financial risks to ensure their communities remain connected during the COVID-19 pandemic. Many are providing free service and setting up free Wi-Fi hot spots, exposing them to cash flow risks.

Universal Service Fund (USF) contribution reform may have a material impact in preparing rural America for any similar occurrence. Given current circumstances, this may be an opportune time to implement long-term structural changes that will help ensure operators in rural America have the support required to bridge The Digital Divide for the long-term.

Current models to help bridge The Digital Divide are not sustainable. Learn why new revenue sources are required sooner than later.

Originally published on September 1, 2020