Remote Cooperative Offers Broadband, WiMax, and Wi-Fi, while Questioning FCC Changes

This past January, Cordova, Alaska, made headlines for getting 20 feet of snow in nearly as many days. The town on the edge of Prince William Sound was declared a disaster area, and utility workers and emergency personnel scrambled to keep roads open and essential services running. But Cordova's residents are used to weather-related hurdles, and for Cordova Telephone Cooperative and Cordova Wireless Communications, weather and topography is a daily consideration that effects everything from line repairs and service to the co-op's business plan. “Weather-related situations like this are common here in Cordova,” said Paul Kelly, general manager and ceo of Cordova. “We’ve learned to rise above them with ingenuity, hard work and stubbornness.”

According to Kelly, being rural doesn't mean Cordova's member companies can't provide first-rate services. In fact, the location has required Cordova to get creative in order to offer broadband connectivity, cellular services, mobile broadband through WiMax, and even internet hot spots via a newly-launched WiFi Cloud in the town of Cordova. “Being in a remote community like Cordova, we will always face challenges concerning access to facilities,” Kelly said. “We use a combination of bush planes, four-wheelers, boats, helicopters and luck to access a great deal of our territory and remote sites. We also rely on bear spray to protect us when we arrive.”

This past August, CTC completed a $12m project, three years in the making, by rolling out 100 miles of undersea fiber optic cable. Kelly said this “finally connected our rural community to the rest of the world in a reliable way.” He explained that Cordova is a remote community which, despite being on the mainland, has no road to it. “We’ve relied on satellite to fulfill our community’s internet needs for many years, but have been working toward this accomplishment for some time,” Kelly said. Now the new fiber optic cable stretches from Cordova to Valdez, and it was deployed from a 200-foot barge over a “mere three days,” as Kelly said.

Marketing and public relations director Cathy Long said that the community is now better connected to the surrounding towns and the rest of the world, thanks to the undersea cable. Member companies now “have speeds and broadband capacity second to none—even better than many places in the lower 48,” Long said.

Completion of the fiber optic line also has bigger implications for the rural Alaskan cooperative: “This accomplishment now qualifies us for the 'new rules’ that the FCC has imposed in the USF and ICC reform order, as well as allows us to deliver the Internet and wireless experiences the modern-day customer has come to expect or take for granted,” Kelly said. Until now, the cost of transport was always the co-op's biggest challenge, but with the cable connection, that burden has been lessened.

The financial reprieve couldn't come at a better time, either, as changes to rural funding make the future uncertain. “We feel we are well positioned to weather the storm we saw coming,” Kelly said, “and our investment in facilities over the past several years will protect us from a good portion of the damage this order will cause the industry. We are also filing for a waiver in hopes of protecting our wireless company.”

But the RUS/ICC changes are already having an impact. “Lost funding will result in fewer jobs at CTC and CWC, and has already resulted in less investment being made in our network,” Kelly said. “Until we are told our past and future investments are protected and recoverable we have no choice but to severely curtail investment and employment.” He said that, like other rural telecom companies, Cordova was disappointed by the FCC's rural funding changes, but says the cooperative is “positioned better than most coming into this change.” Candidly, however, Kelly said, “We do expect our revenues to be impacted in the years to come, especially on the wireless side, and intend to file a waiver with the FCC concerning this order. We feel there is pertinent information that has not been taken into account when writing this new order, and hope to be a poster-child for rural telcos providing service in remote and isolated areas.”

Long reserved her strongest comments for the new FCC order, which she said conflicts with what rural telecom has been doing for decades. “For 90 years, rural telecoms—mostly cooperatives—invested as they were supposed to, using USF and RUS loans to connect rural America at prices comparable to urban areas,” Long said. “Now the FCC commonly refers to what we have done for 90 years as waste, fraud and abuse, yet the OIG audits performed prior to the formulation of the NBP identified almost no waste, fraud and abuse of the USF system whatsoever. The telecom industry was nearly 90% broadband capable and had been building out for years in a very responsible manner. That fact was grossly ignored in the NBP [National Broadband Plan] and credit has not been given by the administration for all the great work performed leading up to the FCC order.”

Nearly 100% of Cordova's member companies have had true broadband access to their businesses or homes for the past six years—“long before any National Broadband Plan,” Long said. Now, CTC “typically provides up to a 4-to-1 meg service to the home but can provide speeds up to 100 megs if there is a need,” Long said. “Take rates are very good and getting better each day as more people discover the Roku devices and over the top TV.”

The cooperative has also been working to expand into non-traditional services through wireless broadband and its wireless subsidiary, Cordova Wireless Communications. CWC just built a 100-foot cellular tower on Naked Island, and now it can provide GSM cellular service all across Prince William Sound. Long explained that “because Cordova’s economy is primarily based on commercial fishing, and many of its residents are commercial fishermen, this is a huge and needed accomplishment” for the community.

CTC's new WiMax service also allows for mobile broadband in Cordova, with plans to expand (via the Naked Island tower) to the Copper River Flatts fishing grounds. The area is also blanketed by the company's Wi-Fi Cloud. Long said these “hotspots are able to seamlessly hand-off to each other, similar to the way cell phone towers do. All this, and we are providing both WiMAX and WiFi Cloud access to all our broadband internet customers as a free service.”

Going forward, Long and Kelly both said that future investment was uncertain, due to the precariousness of rural funding. “Until we know our past and future recovery on investment under the rules is protected, CTC has no plans for future investment in-plant, and our wireless company will soon follow,” Long said. “There is never a business case to be made for investing in the most rural of rural areas without universal support.”