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Sunday, April 11, 2010

AP Slams Obama's Broadband Stimulus Program…Using Republican Talking Points

StimulatingBroadband.com 04/11/2010 San Francisco – An Associated Press (AP) business story receiving wide national distribution this weekend slams the Obama Administration's $7.2 billion broadband stimulus program.  The underlying point of such criticism, and all 3 alleged instances of the program’s waste in the field, are based wholly on talking points recently lobbed against the federal effort by congressional Republicans. 
Rep. Cliff Stearns (R-FL-06) , Ranking Member, House
Subcommittee on Communications, Technology and the
Internet.  The industry documents and points he raised at a March
hearing are the basis of today's widely read
Associated Press story.
The Republican points of attack are, in turn, based solely on input from the 2 largest trade groups representing the cable TV and telecom industries.

The AP article makes no mention that the specific criticisms of the program originated with powerful industry lobbyists.  Nor does the story state such industry complaints were used as partisan attack points against the Administration's program in a divisive hearing, of the House Subcommittee on Communications, Technology and the Internet on March 4.

Large Weekend Audience
The article, written by the AP's staff technology writer Ms. Joelle Tessler is sure to receive a large national readership as local Sunday papers use reams of wire copy to fill weekend editions.  The article, running under various titles including Some find fault with broadband stimulus and Broadband funds stimulate laments from companies has already appeared in the online editions of hundreds of local and regional papers, since its debut yesterday. 

A feature length version of the piece, with accompanying photos from AP staff photographers, has been embargoed until now for publication in Sunday editions.  Given its wide distribution, today's story will become a primary image of President Obama’s broadband stimulus initiatives in the minds of many Americans.  The story gives untold public relations and governmental relations value to the large incumbent cable and telephone operating companies, their Washington based trade associations, and their Republican allies in Congress.

Questionable Veracity of the "Overbuild" Allegations
The story focuses on 3 claimed instances in which federal broadband stimulus monies are being used to "overbuild" existing cable and telephone company networks.  In each quoted case - 1 each in Georgia, Kansas, and Maine - the incumbent service provider says that the federal subsidies have been awarded improperly, unnecessarily, and wastefully.  Each operator and carrier state it is already delivering extensive broadband services within the service areas of the new federally supported networks.

Overbuilding of existing broadband networks -- constructing new networks where broadband systems operate - is prohibited under federal rules of the program.  It is counter to the policy of Congress expressed in the broadband stimulus program within the $787 billion stimulus package (the American Recovery and Reinvestment Act of 2009, ARRA).  The broadband provisions of ARRA are intended to fund new broadband networks, particularly in rural regions, which are "unserved" and "underserved" with broadband services by current providers

Documented findings from around the country that federal funds are being used directly to compete with broadband operations already existing would thus amount to a fundamental, and potentially legal, challenge to the program which is run jointly by the Departments of Agriculture and Commerce.  The story however relies on only anecdotal statements from service providers that their networks are currently delivering high speed broadband services.

Local officials in rural Georgia are quoted supporting 1 of the 3 alleged unnecessary federally funded new networks. No voices representing rural economic developers, rural state governors, or other officials from areas awarded broadband funds are quoted by AP.  Typically such local officials and business people describe how the lack of broadband networks restrains economic growth in their areas.

Based on the article’s information, there is no way to verify the claims of the carrier / provider incumbents, nor review the extensive data inspected by the feds which resulted in the awards based on a finding of a lack of broadband facilities in the areas identified by the AP report.

Familiar Territory
To observers of the broadband stimulus effort, the award locations mentioned in the AP story are familiar, as they mark the first major points of partisan challenge to the program by congressional Republicans.

The North Georgia Network project of Clarkesville, GA, the Three Ring Binder regional system based in Biddeford, Maine, and the Rural Telephone Co. $100 million project in northwestern Kansas were awarded federal subsidies in funding Round 1 of the program.  The Georgia and Maine awards were widely reported media events of December 17, 2009 as Vice President Joe Biden and Commerce Secretary Gary Locke travelled to the proposed network locations to make the first public announcements of funded projects under the program.


Rep. Stearns Opens Congressional Attack on Broadband Program
More recently, the middle mile fiber optic systems in Georgia and Maine, and the Rural Telephone project in Kansas were characterized as examples of wasteful government overbuilding of incumbent networks by Congressman Cliff Stearns (R-FL-06).  Rep. Stearns is the Ranking Member of the House subcommittee with oversight jurisdiction of the broadband stimulus program.   At the March 4 oversight hearing of the Subcommittee, chaired by Rep. Rick Boucher (D-VA-09), Stearns submitted into the record letters addressed to him from the 2 largest trade associations of the cable and telephone sectors. 

The letter from the National Cable Television Association (NCTA) directly accused the Rural Utilities Service (RUS) of the Department of Agriculture of funding an overbuild of cable operator Eagle Communications by Rural Telephone of Lenora, KS.  The letter from the U.S. Telecom Association, trade group of the large incumbent telephone companies like AT&T and Verizon, did not call out a specific funded project. 

U.S. Telecom however did propose, almost 2 months after the rules for Round 2 were promulgated, that the Commerce Department adopt a new approach to funding middle mile projects.  The association stated its leading complaint about the program is that federal monies are “flowing to support the construction of redundant broadband connections rather than being prioritized to get broadband out to those who don’t have it.”

In his prepared remarks at the hearing, Rep. Stearns spoke several times about his opinion that the North Georgia Network was in the process of overbuilding network in place owned by the carrier Windstream.  His fellow minority colleagues, especially Rep. Lee Terry (R-NE-02) spent time attacking the Three Ring Binder project in Maine, and defending the interests of FairPoint Communications in its repeated claims of unfair competition and overbuilding lodged against the federally funded effort.

Our Take: AP Replays Partisan Attacks
It is not a coincidence that the broadband stimulus awards most heavily singled out for criticism by industry lobbyists and by the Republican minority members on the House Subcommittee became grist for the mill of Ms. Tessler’s AP story now reaching far and wide across the nation.  Ms. Tessler and AP took an easy, yet partisan, approach to reporting on a complex issue.  Rather than look independently at any of the 140 Round 1 awards made to date, the AP instead chose the route of simply replaying the critique of 2 industry powerhouses that have not been supportive of the President’s broadband program from the beginning.

Ms. Tessler and her editors at the Associated Press, at the very least, have gotten lazy and sloppy in their examination of an important federal program.

Far worse is the fact that potentially millions of Americans will today see a story about that program based fully on industry and partisan rhetoric.  One of the last remaining great wire services in America should know better.  StimulatingBroadband.com
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