US regulations hard on small phone firms, Sen Pryor, panel hear

While scattered populations and difficult terrain make it hard to provide phone and Internet access in rural America, government regulatory burdens are an even bigger problem, the vice president of Arkansas-based Ritter Communications told a Senate hearing.

John Strode told the hearing of the Senate Subcommittee on Communications, Technology and the Internet, chaired by U.S. Sen. Mark Pryor (D-AR), that companies like his “serve approximately 5 percent of the nation’s population, but approximately 40 percent of the nation’s land mass.” His company employs about 280 people -180 from Arkansas. It provides phone lines to 33,000 homes and businesses - and serves thousands more broadband and basic cable subscribers. Over the years, assistance from the Federal Communications Commission and its Federal Universal Service Fund, among other types of aid, has helped to broaden service availability but more help is needed, Strode said. Cuts, caps and constraints on government funding are hurting companies’ cost recovery, he said. His Jonesboro-based company is hurt by cost limits in areas that are expensive to serve. Strode also criticized larger telephone companies.

Other issues raised:

• Patricia Jo Boyers, president of BOYCOM Cablevision and American Cable Association board member, said it was imperative that the government not subsidize her competition, a point seconded by Sen. Kelly Ayotte (R-NH)
• Steven Davis, executive VP of CenturyLink, continued to push the Federal Communications Commission to raise its $775 per subscriber subsidy, saying that underestimated the cost and helped lead to the result that only $115 million of the $300 million available in the first tranche of Connect America Fund funding was applied for.
• U.S. Cellular chair Leroy Carlson Jr. talked a lot about the upcoming incentive auctions, as well as a previous auction of wireless spectrum.
• He said more spectrum is the raw material of the wireless business, and smaller companies like his must be able to compete for spectrum against the larger companies.