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Tech firms worry about broadband funding

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Tech firms worry about broadband funding
River Falls Wisconsin 2815 Prairie Drive / P.O. Box 25 54022

The expansion of lightning-fast Internet service is slowing to a crawl in some of Wisconsin's rural areas because of new concerns over the future of federal funding that helps pay for those projects.

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The Wisconsin State Telecommunications Association says about half its member firms are delaying or scrapping rural-broadband projects since recent changes have put their federal funding in jeopardy. The Federal Communications Commission has limited the use of the Universal Service Fund, which rural Internet providers rely upon for subsidies.

FCC officials said the $8 billion fund had a lot of wasteful and inefficient spending, therefore, a crackdown on allocations was necessary.

But Internet service providers say they need the subsidies, because rural areas don't provide enough revenue for companies to install broadband service on their own. In some cases, half of a rural broadband expansion is funded by the government.

The Obama White House says universal high-speed Internet is critical for creating jobs and growing things like medical research. The FCC has a goal of making broadband service available in all rural areas by 2020.

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