Open Range’s network to nowhere draws fire

Open Range Communications, the now-bankrupt broadband company that last week became the target of a congressional probe, at first was rejected by the George W. Bush administration for a federal broadband loan to help connect rural communities. Why the Colorado-based company eventually was awarded $267 million — the largest loan in the history of the Rural Utilities Service’s broadband program — will most likely become a key question for lawmakers.

“I don’t understand why this thing was even entertained,” a former government official familiar with the financing program at RUS, a branch of the Agriculture Department, told POLITICO. “To me, it just looked too faulty” paired with a company that “had no track record of being able to deliver.” Open Range — backed not only by a government loan but also by a $100 million investment from JPMorgan Chase — had promised to build a broadband network in 546 communities in 17 states to provide affordable Internet service in underserved areas. But that dream never fully materialized. Instead, lawmakers, government officials and business analysts now are raising questions about why the government would stake so much cash on a company facing some very stiff business obstacles.