Take Five: Broadband deployment in Wisconsin

Wan Panel

What should Wisconsin do with its share of the recently enacted Infrastructure Investment and Jobs Act? When it comes to the broadband deployment piece of the new law, attorney Rod Carter, a partner with the Husch Blackwell law firm and the lead on the firm’s telecommunications team, has a few ideas. He shared them in this Take Five interview.

According to Gov. Evers’ office, Wisconsin is projected to receive a minimum allocation of $100 million to help provide broadband coverage across the state. How can business and municipal governments work together to get broadband access through public/private partnerships and grant opportunities that may come through the infrastructure law?

“There are really four different models they can look at. The first doesn’t really involve a public-private partnership. It’s just a straightforward public investment where the localities build and own and operate their own networks themselves, and that’s really high risk. I’m also going to talk a little bit about the risk and cost associated with each of these models and the control because for municipalities, a lot of this is an issue of how much control do you want over this broadband network. So, the first model obviously is very basic without any public-private partnership where the localities build, own, and operate the networks themselves. That’s a tough one because how do you do that? You’ve got to have some expertise in place. For example, to use that model you must own your own electric utilities. And the push back there is you’re going to have anti-development or deployment efforts that are going to be there from the local phone and cable companies who, for their own interests, want to service customers and maximize profit in that community. So, that’s one that I don’t see being used that much, but it’s certainly out there as a model.

“The next model is what I call public assistance for private investment. If you look at the risk level with this, it’s relatively low risk for the community. The benefit is questionable, and the community doesn’t have much control over the result. So, while you’re talking about something here that is low risk for the community, the result is also an unknown. This model talks about communities encouraging investment through incentives for some sort of other offering they can do to reduce cost to the private sector development.”

As a municipality, do you have to play it evenhanded between the different carriers?

Carter Rodney

Rod Carter

“You should because the problem there is that we know of situations where governmental bodies … that haven’t evenhandedly played things. The result of that is that some carriers are going to be prevented from entering the marketplace and fully deploying what they must deploy. It’s important for everyone to understand that we do a lot of work with the bigger wireless carriers, and the thing that we hear from all of them when they get into a problem involving a municipality is look, ‘We’re really no different than the three of us on this call or anyone out there. We do not have unlimited resources. People think we do but we have a limited bucket of money for infrastructure deployment, and if things are going to be difficult or if we’re going to have obstacles in a given community, we’re going to go spend that money that we have in the bucket this year in a different place.’

“So, the danger that you run into when you favor one carrier or one entity that works to facilitate say distributed antenna systems or something like that is that busines model might not fit with an entity that wants to come in and deploy in that community. And you’re right, then that entity runs the risk that say a Verizon or an AT&T is going to say no, we’re going to take a pass on the University of Wisconsin System and we’re going to deploy our network down at the University of Missouri and the University of Illinois. Or because we can’t deploy in one community, we’re going to go spend all this money in Milwaukee and Green Bay.”

Is there one model that has worked better than others around the country?

“We talked about public facilitation and private investment. The second model is when the public invests the money and the private money then executes on the model, and there you have — we talked risk, benefit, control — so the risk with that model is high because you’re giving your public funding to a private company and you’re relying on that company to perform. Now obviously if they perform, the benefit there will be high, but it comes with some risk. The other thing is there often is less control with that model. There is some control because the public is funding it, but if you’re giving me the public funds to come in and deploy in your community, I’m going to want some control, as infrastructure provider, over my operations in that community. So, that’s the second model.

“The third model is a public-private partnership where there is some short of shared investment in both the entity that’s going to provide services and the community are going to have some skin in the game in terms of financial investment. There is some risk there. It’s probably a middle-ground risk of the three models, but if it works, it has a high benefit. There, too, with control, you’re probably going to have a moderate level of control because you’ve got the community investing and you’ve got the private entity investing.

“And to your question as to which works best, I think it’s the model where you can share the investment, and that’s where the opportunity comes with the grants that will flow to the communities. They will have some cash in their pockets and likewise share the risk in deployment of these networks.”

Is broadband service in Wisconsin somewhat limited because of all the forest land interfering with signals?

“It is, and it isn’t. The concept of broadband envisions three methods of providing service. The first is the traditional municipal broadband that we’ve talked about. That’s easy to understand. You’re in Madison. I’m in Milwaukee. We talked about service from our municipality. The next is middle-mile broadband, which involves those forests and how you get through them. We’re a diverse state when you look at it. We have communities like Madison and Milwaukee and then we have vast stretches of rural area. We’re also diverse from an economic standpoint, so middle mile talks about in those instances, to get from Madison to Wausau and to serve those communities and businesses in between, by nature you must have a less extensive network. You will need something there, but it will be less extensive.

“But then, along that route from Madison to Wausau, let’s say you have a business, a paper mill that has a need for broadband. That’s where you would have what’s called middle-mile plus, where in the middle if you’re going to service the paper mill, there will have to be an influx of broadband coverage. But certainly, we do have challenges here in this state. I don’t know that we’re unique necessarily compared to other state in the Midwest. I think we’re a little better off than other states in the Midwest when you look at our geography. We do have population points throughout the state, and I don’t think the forests necessarily inhibit broadband because once you leave the cities, the cities with 5G and built-out networks, are looking at small cells. Those are line-of-sight installations, kind of streetscape things.

“Think of going around the Capital Square in Madison and the Summerfest Grounds in Milwaukee and serving people who are going to be at the farmers market or at Summerfest and you want to send me a picture of the vegetables you see at the farmers market and I want to send you pictures of the acts or video of the acts I’m watching at Summerfest, and you want that instant response back from me to say, ‘Gee, those tomatoes look beautiful. Buy a bag for me too.’ That’s easy to deploy. The local small cells. The city of Milwaukee is embracing it … Milwaukee has really streamlined the process to get small cells installed, and up and working. That’s in the cities.

“When you get more rural, it’s not practical to have those line-of-sight installations. And even more when you leave the biggest three or four communities. I know Verizon is rolling out small cells in Madison and Milwaukee, downtown Kenosha, Green Bay, and the suburbs around Milwaukee, but when you get beyond that to smaller communities, it’s not real practical. So there, you’re relying on traditional towers to provide coverage. The other issue is not only the tower coverage but the fiber coverage, and getting fiber to some of those communities, to a place like Marinette or Adams County, is difficult. That’s one of the struggles that all the carriers are dealing with.”

Also, according to the Governor’s office, Wisconsin can expect to receive $18 million over five years to protect against cyberattacks. I’m not sure there is an enlistment of private sector in this, but I’m sure that got the attention of businesses because it’s such a huge issue. What are the opportunities for public-private partnerships there?

“There are a few. On the federal front, there is some tax credit financial incentives for research and development in that area. The state needs to look at that and I think it probably will. The other things that would be helpful with those grant dollars if is the state could create or enhance the ways that it communicates concerning cyberthreats and cyberattacks, maybe offering some sort of conduit to suggest what’s out there, how to nip threats in the bud, training, and things like that. And then maybe some implementation of compliance standards that would come from this so that, again, going back to how to incentivize businesses to comply, well maybe you have some sort of enforced compliance program and there is a tax incentive there. 

“Big companies are good with cyberattacks, but it’s about how we help the smaller businesses think about this and prevent it. Training is key and it’s a matter of how you incentivize every business to train their employees. Larger businesses are doing a good job, but we need to incentivize smaller businesses to train and to get some knowledge database out to smaller entities that don’t have the sophisticated IT staffs.”

The National Telecommunications and Information Administration (NTIA) has published a request for comment seeking public input on the design and implementation of the Broadband Equity, Access, and Deployment Program, the Middle-Mile Broadband Infrastructure Program, and the Digital Equity Planning Grant Program — which together will distribute more than $43 billion in broadband funding. What do you hope comes out of that public comment opportunity?

“That $43 billion, think about that. That’s a ton of money for broadband funding, so with that, you’ve got to assess how it’s distributed among the different broadband needs. We’ve talked about municipal broadband, middle-mile broadband, and then that middle-mile plus where you have a special business like that paper mill that’s in the middle of the middle mile. How do you divide that up? How do you determine if your paper mill should get funding or more funding than the city of Marinette? What should come from the public comment opportunity is some good thoughts on how you’re going to split that money up and how you’re going to satisfy those three different needs, those three different broadband needs, each of which is important in its own way.”

You work with telecommunications companies. What’s your advice to business owners and consumers who are frustrated with the pace of the 5G rollout in the United States?

“Right, so what we see, and what I think part of the problem is, and maybe this is my advice to consumers and business owners who are frustrated, is there is a tremendous amount of backlash to 5G. There are people who think there are health risks. There are people who do not want small cells in their community or in front of their houses … That’s an obstacle to deployment to be quite honest.

“The other obstacle is, going back to my bucket of money scenario, these companies only have so much money to spend and, likewise, municipal governments are looking for money and looking for funds. A few years ago, there was no real restraint on what could be charged if you were going to put a small cell, 5G type of installation on a pole. And so, municipalities saw that as an opportunity to generate revenue. Now, Wisconsin and our neighboring states, and really every state in the U.S., has come through and enacted laws that cap fees for pole attachments to attach this 5G infrastructure. Some communities are very resentful of those fees, and they have made it very difficult for carriers to deploy. So, the advice I would give to business owners and consumers who are frustrated with 5G rollout is to look at the cause and maybe reach out to your local government officials and make them aware of your frustration.

“The other issue that is preventing the rollout from occurring as quickly as we want it to occur is that cities are crunched for cash and they don’t have the resources, believe it or not, to process all these applications because they’ve got a dedicated staff in that planning department, and to process however many applications come in for small cells, they are saying we would need half a person more in terms of staffing and we don’t have the money to do it because by law we can’t charge more money for these applications. So, if folks are upset with the rollout and the pace of 5G, it starts for me at a local level. The solution to that is contact your public officials, tell them you are frustrated, and ask them what they are doing to help facilitate 5G and the pace of the rollout.”

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