Broadband Service Report
In 2019 the Mississippi Legislature passed one of the most beneficial laws in recent history: The Mississippi Broadband Enabling Act (MBEA). The MBEA made it possible for rural electric cooperatives like Yazoo Valley to provide broadband service to our membership. Prior to the passage of this act, electric cooperatives could not legally engage in the broadband business.
Before the legislation was signed into law by the Governor, Yazoo Valley management began to study the feasibility of providing the service to our members. We knew from the outset that it would be very difficult, if not impossible for a low-density system, like Yazoo Valley, to launch such a business. Cities and their suburban areas usually have at least minimal high-speed internet service. Moreover, cities and urban areas typically have sufficient density to economically support the infrastructure for telecommunications and other services. But rural areas lack high-speed internet service because there are not enough households (potential customers) to pay for the required infrastructure. For that very reason, the traditional telecommunications companies (some of the largest companies in the world) have not delivered high-speed internet service to rural areas. The MBEA gave cooperatives the opportunity to study the feasibility of providing the service where others had failed to perform. One important caveat to the MBEA was the requirement that electric cooperatives would be required to serve every member who signed up for service. That is a heavy lift, particularly for low-density system.
Yazoo Valley hired an expert consulting firm (Conexon) to perform a Feasibility Study for the Association. The study estimated the cost to construct a fiber optic system that would deliver Gigabit tier internet service. The study was based on a fiber optic system that would be constructed on our existing overhead power lines. The results of the Feasibility Study showed that the low population density of our area would not support a stand-alone business offering fiber-to-the-home. There simply were not enough potential subscribers to pay for building and operating a system. However, a prospective funding source was identified—the Rural Digital Opportunity Fund (RDOF). The RDOF is a taxpayer funded grant program administered through the Federal Communications Commission. The RDOF is awarded through an auction process. It is complex, but bids are submitted not based on how high you can bid, but on how low your bid can go. It is called a reverse auction. Yazoo Valley joined the Rural Electric Cooperative (Conexon) Consortium along with several other Mississippi electric cooperatives. The bidding consortium allowed us to register for the auction and take advantage of the legal and regulatory expertise of a range of consultants and industry experts. Yazoo Valley was bidding on all the Census Block Groups within our service territory that were identified by the FCC as unserved or underserved areas.
The RDOF auction began in late October and continued daily until it was concluded in early November. Unfortunately, Yazoo Valley did not win the Census Block Groups we needed to start a company and provide the service. We are deeply disappointed that we did not win the auction. If we had, our plan was to build a fiber infrastructure to every subscriber on our system. We believe it was the best chance that most of our members had to ever have service at this level. The winning bidders in our area include, NexTier Consortium, Space Ex Tech Corp., and Connect Everyone, LLC. These companies are either satellite or fixed-wireless broadband providers, with perhaps a small amount of fiber optic cable.
Our staff put in hundreds of hours in this project over the past 18 months. Our consultants were former FCC attorneys and others with years of telecommunications experience. We developed our bidding strategy with them and were certain that we would be successful in the FCC auction since no other technology met the requirements for the gigabit tier. So, we were very surprised that when other bidders appeared in the Gigabit tier at the RDOF auction. Fiber optic cable and 5G (which is very limited) are the only proven means of delivery in the gigabit tier. We were deeply disappointed that the FCC permitted fixed wireless and satellite companies to bid and give equal preference against fiber optic bidders. However, we will not be sore losers. We congratulate these auction winners, and we will do everything that is economically feasible to assist and promote the deployment of broadband to our members—even if is by another company.
Why are we just now communicating this? We were under an FCC-imposed “quiet period.” The “quiet period” restricted communications by auction bidders under penalty of law. The “quiet period” was initiated at the inception of the auction and concluded after the auction winners were announced and the long-form applications were submitted to the FCC at the end of January.
Our hope is that the winning bidders start deployment of broadband service very soon. In the meantime, we will monitor any deployment of broadband services in the Yazoo Valley service area and keep you informed on availability through our Today in Mississippi publication and through our website, www.yazoovalley.com.