Industry Issues
Make Ready
One of the biggest cost drivers to expanding Virginia broadband – especially in rural areas - are the fees internet service providers (ISPs) pay to attach to utility poles – called Make Ready (MR). ISPs pay a fee (annual or one-time fee) to attach to utility poles – and sometimes must pay to replace the utility pole altogether. The rates are determined by who owns the pole - the Federal Communications Commission (FCC) determines the rate for investor-owned companies, while municipalities and electric-cooperatives set their own rates.
Railroad Crossings
Railroad crossings can be very expensive and burdensome for ISPs. The Virginia General Assembly acted in 2023 to limit the cost per crossing, and expediate the time it takes to approval a crossing application.
Franchise Agreements
To provide cable television in a locality, a cable provider must enter into a franchise agreement – giving the cable provider access to a municipalities’ rights-of-way to lay their cable lines. In return, the provider agrees to specific terms and services that benefit the municipality and its constituents. In Virginia, there is no universal franchise agreement – meaning for each new locality that a provider wishes to operate in, it must negotiate an original agreement.
Government Owned Networks (GONs)
The Virginia Wireless Service Authorities Act (enacted in 2003 by the General Assembly) enables Virginia Counties, Cities and Towns to form their own Wireless Service Authorities – granting them the ability to provide certain communications services - including internet services. Several localities have attempted to operate their own broadband organizations – however, history has shown they have financial trouble, and a waste of tax-payer dollars.
Workforce
ISPs and utility providers contract with many of the same subcontractors or hire from the same workforce pool, which causes an issue when training and retaining workers. In addition, this workforce is ofttimes nomadic and travel between states – going from job to job. Virginia must invest in workforce training programs to make sure that ISPs can meet the demand brought on by the influx of state and federal government funding.
Adoptability
There are government programs (like the Affordable Connectivity Program (ACP)) that make internet access more affordable. We are proud to report that all VCTA Members offer the ACP in Virginia. When it comes to ACP, many who qualify, aren't aware of the program. In rural Virginia, for every ten houses that have broadband available, only four take the service (equaling a 40% adoption rate). VCTA Members are available to partner with stakeholders to raise awareness about the ACP.
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