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Summary:

There is a broadband face-off going on in Arkansas. And its over a bill that want to spur broadband penetration by offering income tax breaks. Even though it is not particularly a rich state, Arkansas is offering tax breaks worth around $36.5 million over four years […]

There is a broadband face-off going on in Arkansas. And its over a bill that want to spur broadband penetration by offering income tax breaks.
Even though it is not particularly a rich state, Arkansas is offering tax breaks worth around $36.5 million over four years to spur broadband deployment in the state.

This bill, SB Bill 980, approved Thursday by the Senate’s Technology and Legislative Affairs Committee, calls “for companies that offer broadband service to Arkansas counties with 20,000 or fewer residents to receive a 15 percent state income-tax credit. Those that offer service to counties with 20,000 or more residents would see a 10 percent credit.”

SBC and Alltel are backing this one but cable companies like Cox are opposing it. Cable companies complain that there is no reason why government should subsidize the phone companies’ broadband efforts.

“These guys want all the breaks. They know exactly what they’re doing,” Regan said. “It’s hardball, pure and simple. We did it with no breaks and all private money. We’re real competitors.”

They want the bill to be restricted to new greenfield deployments. I don’t understand why any of these guys have to get tax breaks, considering that they all get some funds from the universal service fund and all. Still, if this will spur them into action, so be it. Arkansas sees broadband as key to its future.

“The pace at which broadband is being adopted — in an economy where doing business means getting information — is so fast that if we don’t act now, we may never catch up,” said John Ahlen, president of the Arkansas Science and Technology Authority.

Full story @ Arkansas Democrat Gazette

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By Om Malik

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