Broadband in the Boonies Gets a $267M Boost

18 Comments

Rural Broadband Via SatelliteIf you live somewhere in the United States where dial-up is the only Internet access option, relax: Help is coming, and so is broadband, thanks to Denver-based Open Range Communications. The company got a hefty $267 million loan from the USDA under its Rural Development Broadband Loan and Loan Guarantee Program and will roll out broadband services in 518 rural areas in 17 states that include Illinois, Alabama, Arkansas, California, Pennsylvania, South Carolina and Wisconsin. Open Range has also buttoned up $100 million in private equity investments. This is one of the largest investments in rural broadband so far.

Ironically, for a company that’s getting such a huge amount of money as a loan, there is little or no information. Open Range’s web site is a placeholder with a link to an email address for its PR person. Given that it secured hundreds of millions of dollars from a government department, one should expect more transparency. Even the details on how the network and service will be rolled out remain sketchy. Open Range will use a combination of technologies, including WiMAX, to bring broadband to these communities.

Frank Ohrtman, president of WMX system, a Denver-based WiMax consulting firm, tells The Denver Post that Open Range will “sublease the spectrum from others” and will deliver “a land-based broadband service using spectrum that was allocated as a satellite spectrum.” Clearly, Open Range isn’t using standards-based technologies.

Open Range cut a deal with Globalstar, a satellite services company, in 2007 and, as part of that deal, will deploy a network that will use Globalstar’s Ancillary Terrestrial Component authority.

Photo courtesy of Gino via Flickr.

18 Comments

Joe Wargo

As an owner of an outdoor wireless integration company, when the announcement of stimulus funding for rural broadband was made, we saw a mad dash from wireless broadband manufactures to receive their “Buy America Status” under the USDA. The requirements to be considered for certification are extremely light. Many companies outside of the USA qualify if they are part of NATO for example. Otherwise all a hardware manufacture needs to do is load their firmware here in the USA and they can get certification.
We were also contacted by a lot of so called service providers that were going after the stimulus funds. Most if not all of these companies were not established companies at all. Most were a few people that came from larger telecom entities, which quickly established an S-Corp and started grabbing licenses for the 3.65GHz band in various rural areas. This way they could have a better chance at getting funding or be able to sub-lease the spectrum. These companies need our expertise to put together a design for submission. Note: we rejected many of these start up firms.
It’s a shame that the funds were given out so quickly to many unqualified companies that do not have the engineering nor staff levels to deploy a legitimate long term WiMax solution. Unfortunately I believe a lot of money will be lost, but some fortunes made!

PoDunk

Rural broadband? Come on. Fort Collins, Colorado (pop – 137,000, home to a state university, and 48% of the population has completed 4+ years of higher ed), Loveland, Colorado, Longmont, Colorado? These towns are hardly rural and as of March 30th 2010, Open Range has no subscribers. Their installation has gone terribly – possibly due to non-industry standard techniques (evidence of a company with no prior experience) and bad hardware (Alvarion).

I wondered about this company when I started doing work for them. Government funding that doesn’t deliver what it promises. Certainly stinky…

Kimberly Johnson

Om,
Thank you for reading and posting a link to my story. I’m doing more research into this company, as I’ve received several comments about the company. Open Range has all but taken down their website following these reports. Strange.

Amitabh Kumar

Rural broadband does not need such loans. Services such as Surfbeam or wildblue delivered over satellite can do much better. WiMAX can be a local extension in an area, but perhaps only in the next two years when wimax customer devices are much easier to obtain.

Seaowl

There needs to be accountability for these companies that are getting loans under this program. We need to establish strong service quality standards and consumer protections. Providers should be made to publicly report the actual speeds of the services they offer. Cost to consumers should be monitored so that the service is truly affordable for all.

These are some of the goals of the Communications Workers Of America’s project Speed Matters. Check out their website at http://www.speedmatters.org for more information.

ShelterWatch

Agree. It is odd that a company which just got a large loan from the Feds doesn’t have office staff to answer the phone during businss hours(I called last week the multiple numbers on their website) and now have basically a non-functioning website. This website was fully-functional last week and you can probably access the archives on http://archive.org.

bj

Dave, I hope you’re wrong. But this PR firm, Percepture, located in Parsippany NJ, is known for representing Telecoms and is only around 10 miles, as the crow flies, from the Verizon Operations Center in Basking Ridge NJ (former home of AT&T Longlines.)

Is anyone else picking up a whiff of stink? ;)

Dave Burstein

Om

I don’t know this outfit, but am glad someone like you is looking for the details. Many of the USDA loans have gone to projects based on nearly impossible to achieve subscriber rates. Others are political. The result: an enormous percentage of the RUS loans went into early default.

All of which I hope isn’t true for this one, where I have no data.

db

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