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Rural Services Take Center Stage

By | February 2, 2004

      A first-of-its-kind Federal Communications Commission (FCC) forum last week highlighted a wide array of ways that satellites can serve rural consumers across the United States. The event’s significance was underscored by the participation of FCC Chairman Michael Powell and all four of his fellow commissioners.

      The forum included top-level speakers from a host of industry companies, as well as a concurrent technology demonstration. The focus on existing applications revealed a number of initiatives that have been introduced in Alaska and elsewhere to bring satellite-based communications services to rural communities, but offered just a hint of the new satellite broadband services that are planned for rollout this year.

      “The ubiquity of satellite signals has long held the potential to deliver advanced communications anywhere and everywhere in America,” Powell said during his opening remarks. The rural satellite forum was intended to showcase the “significant progress” that has been made to realize the full potential of satellite technology, he explained.

      A series of panel discussions during the full-day event addressed a variety of key applications, such as critical public safety activities, farming and agricultural services, Internet access and mass media entertainment services, and telemedicine and educational services.

      FCC Commissioner Kevin Martin began his moderation of a panel discussion about public safety by mentioning his first-hand experience of growing up in a rural community in North Carolina. He eloquently explained the so-called “digital divide” between people in urban areas who have access to first-rate communications and those in rural areas who have inferior service or none at all.

      For communities to grow and to advance economically, it is essential they have access to the same communication technologies available to people elsewhere, Martin said. Satellite is a critical technology that can be made more cost-effective to serve rural areas, he added.

      The public safety panel included presenters from Iridium Satellite, Globalstar, ORBIMAGE and Mobile Satellite Services. Each of the companies has gone through a financial restructuring, but their representatives emphasized the role they now play in vital public safety applications.

      John Schroder, Iridium’s director of homeland security sales, emphasized the uninterrupted service offered by Iridium phones during blackouts last year and the terrorist attacks of Sept. 11, 2001. Iridium phone service use jumped more than 377 percent in the New York area when the terrestrial networks failed during last year’s widespread power outage, he explained.

      Public safety applications for Iridium include port security, Alaskan search and rescue operations, aircraft and vehicle tracking during wild fires, and medical emergency services. Iridium service also is available in rural and remote areas where terrestrial capability may not exist, Schroder said.

      Globalstar applications for public safety include the Salt Lake City Olympics, the Space Shuttle recovery efforts early last year, and emergency services, said Andy Radlow, Globalstar’s director of sales and marketing for the United States and the Caribbean. The Adirondack Rural Health Network is another user of Globalstar in daily efforts to safe lives during medical emergencies, Radlow said.

      A dramatic use of Globalstar’s service occurred when climber Lou Barth was injured and stranded on a ledge for 24 hours in North Cascades National Park, Radlow said. Another rescue was aided by Globalstar when a sailor in the Gulf of Mexico was able to use its data system to e-mail people his coordinates to aid a U.S. Coast Guard rescue.

      Gary Adkins, ORBIMAGE’s vice president of federal and national security programs, said his company’s imagery is used for government and national security, mapping and surveying, and monitoring hurricanes.

      Agricultural Assistance

      Commissioner Jonathan Adelstein, who moderated the session on farming, explained that satellites make it possible for people in rural markets to connect with the Internet and to provide vital services.

      Dr. Peter Williams, director of advanced programs at a John Deere [NYSE: DE] business unit, NavCom Technology, described the use of the Global Positioning System (GPS) in “precision farming.” Such farming techniques use GPS to measure the precise yield of a field to help manage the application of fertilizer and seeds to optimize future yield and avoid harmful run-off due to over-application.

      GPS also helps to guide farm equipment to maximize efficiency, Williams explained.

      AgriStar Global Networks, a provider of two-way, high-speed broadband services for agricultural purposes, uses the DirecWay service of Hughes Network Systems. The AgriStar service began final field-testing in the fourth quarter of 2001 and began a rollout in mid-2002.

      AgriStar plans to have approximately 100,000 top farms and ranches and 10,000 agri-businesses networked within two to three years, and upwards of 200,000 total users within five years. The size of the farms served can range from a few hundred acres to several thousand acres, said Cliff Ganschow, AgriStar’s chairman.

      Ed Cameron, director of the U.S. Department of Agriculture’s Rural Utility Service, said his role is to enhance the quality of life in rural America with telecommunications and other services. Those efforts will be aided by a 2004 budget that offers $688.5 million in telecommunications loans, $300 million in distance learning loans, $460 million in broadband loans, $39 million in distance learning grants, and $9 million in broadband grants. The funding totals close to $1.8 billion, he added.

      The loan funds go largely unused, while the grants are in “high demand,” Cameron said.

      Also on the horizon is the Local TV Act, published in the Dec. 23 Federal Register, which has an April 21 application deadline for $1.25 billion in loan guarantees to facilitate the delivery of local TV signals to unserved and underserved areas in the United States, Cameron said. Satellites provide a possible solution, but the applications are open to companies using other technologies, too, he added.

      Other opportunities for satellites to tap the funds of the Rural Utilities Service include offering distance learning and telemedicine applications. Distance learning grants fund end-user equipment, not transmission; however, distance learning loans can fund both, he said.

      The broadband grants are highly competitive, generally modest and go to communities to provide last-mile connectivity, Cameron said. One example of a project that might receive a grant is one that would create a Wi-Fi distribution system to deliver satellite-based broadband service to an isolated community, he added.

      ‘Success Story’

      The biggest rural satellite success story is the deployment of high-powered, digital satellite TV service across the United States, Cameron said. Such satellite TV capabilities have brought the “greatest improvement” in the quality of rural life since the telephone. Satellite radio has similar potential, Cameron said.

      The biggest challenge faced by satellite TV is in developing a viable business case for rural areas, Cameron said. Profit-oriented companies typically look for the low-hanging fruit in urban areas and shun rural areas with poor prospects for a financial return. “I hope we can fill in the markets that [EchoStar Communications’] DISH Network and DirecTV do not currently serve,” Cameron said.

      Rural broadband services also were addressed during the final panel of the day that featured Internet and mass media entertainment services, such as satellite broadcasting. The National Rural Telecommunications Cooperative (NRTC), Sirius Satellite Radio [Nasdaq: SIRI], XM Satellite Radio [Nasdaq: SIRI], RFD-TV and Sky Frames [OCT: SKYU] all were represented during that closing panel.

      Mark Brown, the NRTC’s senior vice president of member business support, explained that his organization committed $29 million to take a 15 percent stake in the WildBlue satellite broadband service that is expected to begin providing service later this year. The two-way, Ka-band service, capable of download speeds for up to 3 Mbps and upload speeds of up to 0.5 Mbps, also has investments from Intelsat, Liberty Satellite and Technology, Kleiner Perkins Caufield & Byers and WildBlue Chairman David Drucker.

      “Satellites overcome the last mile obstacle, which, historically, has been the impediment to bringing advanced communications to rural areas,” Brown said. “WildBlue was created for rural America.”

      The WildBlue service would bring new businesses into rural communities to provide opportunities for the youth to stay and for long-term economic viability, said Brown, whose organization supports more than 1,100 rural utilities in developing telecommunications and information technology.

      Brown urged the FCC to promulgate rules to ensure that satellites are not disadvantaged in attempting to provide a low-cost alternative to DSL and cable.

      Rob Briskman, a founder of Sirius, said that he filed the first application for satellite radio 13 years ago. “Without the FCC, we never would have been able to get going,” Briskman said. Now, he is attempting to develop an improved stationary antenna that would provide service to Alaska and the northern parts of Canada.

      Briskman, an industry elder statesman, drew laughter from the audience when he summarized the meaning of a chart he presented to its bare essence: “rural radio service sucks.”

      Lee Abrams, XM’s chief programming officer, backed up that view and drew yet more laughter by telling the attendees that rural radio “really does suck.” He also did more than just entertain those left in the room at the end of the day by describing the situation in Casper, Wyo., where two owners control all 10 local radio stations. The formats of four of those 10 stations are country, another four offer oldies and the last two air adult contemporary music, he explained.

      Local channels now tend to offer “syndicated radio,” he said.

      “Home-spun local stations ended in the 1950s,” Abrams said. Each satellite radio service offers 100 channels to allow the interests of niche audiences nationwide to be served.

      “XM is more local than 99 percent of the stations in America,” Abrams said. Disc jockeys at XM are encouraged to reach out and solicit callers from regions throughout the country, he explained.

      The key selling points for satellite radio are unprecedented choice, signal quality and diversity, Abrams said.

      Patrick Gottsch, president of RFD-TV, explained that his company owes its existence to the FCC for requiring that U.S. satellite television services, such as EchoStar Communications [Nasdaq: DISH] and DirecTV, set-aside bandwidth for public service programming. RFD-TV offers a television channel designed specifically for rural viewers that also is carried by the Mediacom and NCTC cable systems. “There would be no rural TV service without the set-asides,” he said.

      The forum also offered input from two satellite trade association officials.

      Richard DalBello, president of Satellite Industry Association, said that “the forum did an outstanding job of highlighting the satellite industry’s unique ability to provide public safety, education, and telemedicine services to all regions of the United States, regardless of population or location.”

      DalBello also praised the FCC’s International Bureau for taking the lead in organizing the event.

      David Murray, vice president of government affairs with the Satellite Broadcasting and Communications Association (SBCA), said the forum allowed the FCC to bring greater awareness to the “crucial role” that satellite technology plays in delivering voice, video, and data to the most rural and remote regions of the United States.

      Another strength of the event was a concurrent exhibit that featured satellite technology demonstrations by operators, resellers, service providers and ground equipment manufacturers. Participating technology exhibitors included Telenor Satellite Services, EchoStar, Mobile Satellite Ventures, Sirius, Hughes Network Systems, and Cablevision Systems’ [NYSE: CVC] Voom service.

      –Paul Dykewicz

      (Michael Powell, FCC, 202/418-1000; Kevin Martin, FCC, 202/418-2100; John Schroder, Iridium, 703/465-1022; Andrew Radlow, Globalstar, 408/933-4033; Gary Adkins, ORBIMAGE, 703/480-7551; Clifford Ganschow, AgriStar, 312/595-1200; Jim Collins, Sirius Satellite Radio, 212/901-6422; Chance Patterson, XM Satellite Radio, 202/380-4318; Patrick Gottsch, RFD-TV, 615/650-6000)

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