Access to reliable, high-speed internet is essential in today’s world. If people can’t afford broadband, or access is unreliable, it can have profound impacts on personal finances, education, health care, business productivity, even an informed electorate. Many newspapers now deliver the news online only, and subscribers need internet access to read the news.
While the most recent U.S. Census data indicates 73 percent of households in Arkansas have an internet subscription, that doesn’t tell the entire story. People across the state, from rural to high population areas like Little Rock and Northwest Arkansas, report frequent outages and poor service. While some of that was linked to the additional demand during the pandemic and damage from the extreme winter storms in February, months after the storms, some customers have reported that service has become even more unreliable.
Disgruntled customers often can’t switch to a different provider because of the lack of competition.
State Sen. Ricky Hill (R-Cabot) hears almost daily from people frustrated by unreliable internet service. He knows where they are coming from.
“Broadband is the electricity of the 21st century,” Hill said. “We have to get broadband out to the people because it may determine whether a community survives or not. Everything revolves around it, including the education kids get and the ability to attract new residents and economic development. It is a major issue.”
Hill, who lives two miles from Cabot, pays for two internet services at his house, subscribing to Sudden Link and CenturyTel. He says he must do that because one of the two is down nearly all the time.
The Arkansas Legislature recently passed Act 67, sponsored by Hill, designed to increase broadband competitiveness by significantly reducing barriers to municipal broadband. Act 67 allows cities, counties, utilities and other government entities to provide broadband services. Previously this was primarily reserved for cable and telephone companies.
Hill hopes the act will help cities provide less expensive and more reliable service.
“We don’t have any way to go but up,” Hill said. “In Central Arkansas, one of the first places people and businesses look to relocate is Conway. One of the reasons is because they have municipal broadband that is better than the surrounding areas. You can’t work without the internet. That is the world we live in now. If our broadband companies worked as hard as their lobbyists do to keep competitors out of the market, we would have not have a problem in Arkansas.”
Conway has municipal-owned systems for electricity, telephone, water and wastewater, security services, cable television, video streaming and broadband. Conway Corp. operates the broadband system. By being nonprofit and taking advantages of the synergies of shared infrastructure such as telephone poles, offices and billing, some customers in Conway report that their entire bill for all those essential services is only as much as they were paying for broadband in other cities.
In April 1997, Conway became the third city in the country to offer broadband. That grew out of the city obtaining an exclusive cable franchise that started operating in 1981. Conway Corp. rates and bond issues are regulated by the city.
Conway Corp. CEO Bret Carroll said it was forward-thinking and innovative of the city to provide broadband. “There are 15 municipal power companies in the state, and only three offer internet service — Conway, Paragould and Clarksville. We are a private, nonprofit corporation, and I report to a board of directors. Our rate increases, rate decreases and bond issues are approved by the city. We are able to make decisions in the best interest of our customers.”
A dense customer base makes the economics of broadband work better. And now, many rural electric cooperatives are stepping in — often helped by gener ous government subsidies — to provide broadband even in the sparsely populated areas they serve. It is considered essential for economic development, particularly since post pandemic, many people are leaving crowded, expensive cities to relocate in rural areas with a more affordable cost of living. But those new residents often work and study from home, and reliable broadband is essential.
The big hurdle to municipal or rural broadband is the initial capital outlay.
“If you have some help from the federal government or others to build some of that infrastructure, the economics work out better,” Carroll said. “Government programs are coming out that are specifically geared to rural broadband.”
President Joe Biden has advocated spending $100 billion to provide broadband throughout rural America in the next eight years.
Conway Corp. is not a monopoly. There are other broadband providers that serve the city. But with such attractive rates and reliable service, Conway Corp. provides internet to 22,000 homes out of about the city’s 28,000 residential electric meters. That represents about 80 percent market penetration.
Carroll said by keeping ahead with investments in their infrastructure, Conway Corp. was in a position to meet the demand during the pandemic that increased 24 percent between February and April of 2020.
“If we had any customers not having access to internet during the pandemic, I’m not aware of it,” Carroll said. “We do get questions frequently from customers who live just outside of the city limits where land is more affordable. Those residents want what they have been accustomed to when they lived in the city. Our franchise allows us to serve up to 2 miles outside of city limits. Where density is broad enough, we are looking at those opportunities right now.”
In addition to lower costs, people appreciate getting just one bill. And if a community doesn’t have reliable broadband, people decide to live where it is available.
Conway Corp. also has a local call center, which customers seem to prefer. Carroll said what Conway has is unique and may not be easily duplicated.
“We’re blessed with having had people with so much foresight,” Carroll said. “It is really hard for a city these days to municipalize. They have to buy out the electrical assets of the provider. It is just a big lift. It is not easy.”