February 18, 2010

Wireless Gets a Little Stimulus

The government continues to dole out stimulus money in batches, announcing yesterday the selection of 11 more broadband infrastructure projects in nine states. Funding for the projects is being provided through the American Recovery and Reinvestment Act (ARRA).

The first two rounds of ARRA broadband awards were slanted heavily in favor of middle-mile providers and telcos. (For more, click here and here.)

This recent batch from the United States Department of Agriculture, totaling over $277 million, includes some wireless projects.

Dean Cubely, CEO of ERF Wireless said profitability is the main obstacle to building out wireless broadband networks in rural areas.

ERF Wireless has carved out successful niches for itself by serving the oil and gas industry and the banking industry with wireless broadband. (For more, click here.)

“You have to have funding or a good vertical market strategy with someone else who will provide the additional revenue streams where there’s not enough households,” said Cubely.

ERF operates its niche WiMAX network in the 3.65 MHz spectrum and serves oil and gas production areas all around the country. It also provides service to bank and residences in the rural areas it covers.

Cubely said the company did file for stimulus funds and plans to file again in the second round. ERF has not received any awards to date.

Following is yesterday’s list of award recipients by state:

• Indiana, Smithville Telephone Company: $37,729,143 loan to provide 3,815 households, 209 businesses, and 12 community anchor institutions with access to broadband service.
• Iowa, Southeast Iowa Rural Wireless Broadband: $3,836,926 loan to provide Internet services to 80 rural communities using proven wireless technology.
• Kentucky, Mountain Rural Telephone Cooperative Corporation: $39,843,535 loan and $38,281,044 grant to provide fiber to Morgan, Menifee, Wolfe, and Elliott counties that will result in 20 Mbps bandwidth to end users.
• Louisiana, Allen’s Cable: $3,584,680 loan and $3,513,697 grant to extend fiber into rural areas of three South Louisiana Parishes.
• LBH- $16,693,439 loan and $16,691,939 grant to expand existing fiber into rural areas around Moss Bluff, Oakdale, and Vinton.
• Minnesota, Southwest Minnesota Broadband Group: $6,350,000 loan and $6,350,250 grant to provide service to eight rural communities throughout Southwest Minnesota.
• Missouri, Unionville, Missouri FTTP Project: $5,140,458 loan and $5,140,458 grant to provide broadband services to households, businesses, and key community organizations that are currently underserved in the Unionville area.
• New Mexico, Western New Mexico Telephone Company: $11,516,679 grant to provide last mile broadband services to remote and unserved locations and critical community facilities throughout Western New Mexico. Baca Valley Telephone Company: $1,651,000 loan and $1,586,000 grant to expand fiber optics to Digital Subscriber Line (DSL) nodes in rural Northeastern New Mexico, replacing outdated deteriorating copper wire and low bandwidth microwave transport systems in some areas, while providing new connectivity in others, and enabling advanced, high-speed DSL service throughout the area.
• Oregon, Sandy Broadband Infrastructure Project: $374,548 loan and $374,537 grant to provide broadband service to the underserved rural area of Sandy by improving and expanding wireless Internet service.
• Texas, Southern Texas Broadband Infrastructure Development and Adoption Project: $40,093,153 loan and $38,520,868 grant to develop a broadband infrastructure in eleven unserved and underserved rural communities of the South Texas Plains.